The Fastener Distributor Index declined in August, dropping to 49.2 from 54.6 the previous month amid plummeting sales.  June’s figure of 56.9 was the index’s best reading since November 2018.

“After two consecutive months of fairly sharp improvements in the FDI, naturally the rate of improvement stalled some in August,” R.W. Baird analyst David Manthey wrote.

The seasonally adjusted sales index fell 31.6 points to 47.6 in August.

The Forward Looking Index dipped 1.7 points to 53.1, while employment grew a modest 1.8 points to 46.1 in August and supplier deliveries improved 3.4 points to 60.5.

“Taking the FDI and FLI together, in our view, we believe this indicates August fastener market conditions showed relative stability in trends after several consecutive months of strong month-to-month improvement,” Manthey explained.

Meanwhile, month-to-month pricing fell 6 points to 52.6, while year-to-year pricing declined 1.3 points to 65.8.

The August FDI reading “indicates the trajectory of sales trends is improving m/m, but activity levels are likely not yet near pre-COVID levels,” Manthey stated.

“Looking at the drivers of the m/m moderation in the FDI, sales trends continued to improve, but the employment index slightly decreased, dragging down the overall index,” Manthey noted.

Respondent commentary moderated in August.  Twice as many distributors expect lower activity over the next six months, while 53% expect higher activity and 24% anticipate no change.

“More activity,” one respondent commented.

Another distributor expressed frustration at what he sees as a tight labor market.  “We need more humans in our business!”

A third respondent expressed concern over current trends.  “Down 25% from last year’s August.  Down 11% YTD compared to the same period last year.  Very, very slow month.”

The FDI is a monthly survey of North American fastener distributors conducted by the FCH Sourcing Network, the National Fastener Distributors Association and Baird.  Web: fdisurvey.com