The seasonally adjusted Fastener Distributor Index (FDI) improved to 50.4 in May from April’s weak 46.9 reading, reflecting “normalization off a very weak April, which we believe had been impacted by some pre-buy in March ahead of tariffs,” according to R.W. Baird analyst David Manthey (CFA) with Quinn Fredrickson (CFA).
Four in ten respondents (39%) said sales came in above seasonal expectations (up from 30% in April), while 39% indicated sales were below expectations (down vs. 45% last month) and another 21% reported steady.
Pricing continued to climb as steel/China/global import tariffs take hold. A majority (64%) of respondents reported higher pricing vs. April, which matches last month and follows 61% in March, 48% in February, and 17% in January.
The Forward-Looking Indicator improved to 50.2, driven by higher employment levels, leaner customer inventories, and slower supplier deliveries.
“Quantitatively, the six-month outlook was slightly weaker, however, as 33% of participants forecast better activity levels over the next six months vs. today – further eroding vs. 48% last month and compared to December when participants were significantly more optimistic (61% expected improvement at that time).”
Another 42% forecast steady (higher than the 15% in April and 22% in March), while 24% expect sales to deteriorate further (vs. 36% last month).
“Again this month, nearly all commentary focused on tariffs impact on pricing, demand and the outlook.”
Most reported eroded demand.
“Tariffs are starting to cause demand to soften with customers. Prices are going up and its been a challenge with many customers passing it along… challenging and chaotic times.”
Another respondent noted: “Tariff uncertainty continues to depress demand - wait and see attitude while burning off existing inventory - manufacturing seems to continue to slow/delay product launches.”
Several survey participants criticized pricing uncertainty, which complicates planning.
“Tariffs continue to be a distraction, and business strategies remain fluid. It’s hard to plan ahead when you can’t see what's coming. Meanwhile, business is steady, maybe a slight falling off but expect the same level over the next 3 months.”
Quoting increased as customers seek alternative sources of supply.
“We’re seeing a significant uptick in RFQ activity, suggesting elevated interest across the market. However, this hasn’t translated into firm orders—indicating much of the activity may be exploratory or price-testing in nature. Notably, there's been a marked increase in requests specifically for domestically manufactured products, but these often stall once pricing is provided—likely due to sticker shock compared to offshore alternatives.”
In contrast, a different commenter said, “Way fewer RFQ's this month but we converted a higher percentage of them to make up for part of that loss. Still, not a great month.”
FX is also having an impact on pricing.
“[We are] anticipating slower demand if the tariffs remain in effect at the current levels. As a result, [we’ve] seen a sudden price increase, and the exchange rate of the dollar is now down 11%, which impacts price also.”
A few survey participants report healthy activity levels.
“Currently, demand has been outpacing capacity, making it difficult satisfy future customer needs.”
“YOY sales up by 10% - Good action.”
Fastenal reported May daily sales grew 9.3%. Fastener sales accelerated to 8.9% growth (from +1.5% in April). Elsewhere, safety sales increased 10.4% and other non-fasteners grew 9.2%.
The FDI is a monthly survey of North American fastener distributors conducted by the FCH Sourcing Network, the National Fastener Distributors Association and Baird.
