Key Takeaways:
- The Fastener Distributor Index rose to 56.9 in May 2026, growing for the 13th straight month and signaling steady growth.
- The Forward-Looking Indicator climbed to 58.9, while the ISM PMI hit 54.0, marking its fifth consecutive expansionary reading and pointing to a healthy industrial economy.
- Fastenal posted May daily sales growth of 14.8% year over year, with direct fasteners and hardware up 15.9%
The fastener market continues to show growth in 2026. The latest Fastener Distributor Index, produced by R.W. Baird and the FCH Sourcing Network, shows distributors are still growing, still hiring, and still raising prices.
What Does the Latest FDI Report Say About Market Health?
The seasonally adjusted FDI came in at 56.9 in May, up slightly from 56.3 in April. That marks the 13th consecutive month of expansion and the second-highest reading of 2026, trailing only March’s 59.7. Any score above 50 signals growth, so a number near 57 reflects solid, sustained momentum.
The Forward-Looking Indicator, which blends four forward-looking inputs, rose to 58.9 from 57.4. Leaner customer inventories and stronger employment drove the gain. The broader industrial picture looks healthy too. The ISM PMI accelerated to 54.0 in May, its fifth straight reading above 50.
Sales eased to 72.4 from a robust 77.1 but remain strong. Fifty-nine percent of respondents reported sales above seasonal expectations, well ahead of the average of roughly 49% over the past 12 months.
“May was a strong month with growth across various industries,” said one respondent. “Data centers are still driving growth, but recent lagging markets are starting to emerge with growth indicators.”
How Are Fastener Distributors Responding?
Distributors are adding people. The employment index jumped to 62.5 from 56.5, with the share reporting staffing above seasonal norms rising to 28% from 16%. Supplier deliveries also improved, lifting that index to 57.8 from 50.0.
Customer inventories remain a soft spot, posting a fifth consecutive sub-50 reading at 40.6. Most distributors say customer stock levels are in line, though a growing minority say they are too low.
Pricing also keeps climbing. Year over year, 84% of participants reported higher prices. On a monthly basis, no respondent reported lower prices for a fourth straight month. Tariffs, fuel surcharges, and geopolitical disruption are layering cost pressure across the supply chain. One participant noted that domestic lead times have not eased despite tariff reductions, and several flagged longer waits and higher landed costs tied to crude oil and shipping.
“Actually seeing on average an additional 5% to our landed cost as a result of crude oil increase,” said one respondent. “That is not part of the calculation of cost but is impacting our supplier prices.”
Data centers also continue to dominate the conversation. As one respondent put it, growth is real, but eventually those projects shift from building to maintenance.
Real-World Impact: Fastenal’s Performance
Fastenal’s results back up the survey. The company reported May daily sales growth of 14.8% year over year, ahead of Baird’s 13.7% estimate and Fastenal’s own 13.1% benchmark. That beat normal seasonal expectations by about 170 basis points.
Direct materials grew 16%, while indirect materials accelerated to 14.5%. Direct fasteners and hardware, roughly 21% of May sales, rose 15.9% year over year. Indirect fasteners and hardware climbed 15.3%. Baird models continued low-double-digit growth for Fastenal across 2026.
What to Watch Next
The fastener market enters mid-2026 on firm ground. Expansion remains broad, employment is rising, and Fastenal’s numbers confirm the momentum is real, not just survey sentiment. Still, dispersion is widening beneath the surface. Tariff-driven inflation, freight costs, and uneven customer behavior are limiting forward visibility, even as growth holds.
Keep an eye on customer inventory levels and the durability of data center demand. Both will shape whether this run continues into the back half of the year.