Purchases of aluminum products from U.S. mills dropped 20% in December, guaranteeing a 12% drop in buying from foreign and domestic mills for the year. Projected use of 11.2 billion lb by metalworking companies last year was almost 22% lower than the 14.2 billion lb used in 2000. "While December orders typically decline some 10% from November, magnitude of the purchasing decline is consistent with a weaker economy," notes analyst Michelle Applebaum at Salomon Smith Barney's Chicago office.

When compared with the previous month, December purchasing from domestic mills was down in every product category: sheet and plate, -17.3%; bar, rod & wire, -10.2%; extruded shapes, -18%; foil, -30%; forgings, -13.5%; insulated cable, -19.5%; and aluminum conductor, -41%. For the year, purchases of sheet and plate from U.S. mills dropped 14.2%; can stock fell 1.8%; extruded shapes slipped 7.6%; bar, rod and wire dropped 18.3%; insulated cable fell 9.8%, aluminum conductor slid 26.3% and forgings dropped 27.8%.

Analyst Lloyd T. O'Carroll at BB&T Capital Markets in Virginia points out that new order data is volatile on a month-to-month basis, so the December data "isn't necessarily an accurate depiction of market conditions. December was the end of a terrible year for the economy; thus, economic activity may have been unusually slow during the holidays." However, aluminum buyer surveys conducted by Purchasing Magazine find no dramatic pickup in January purchasing.