Steel Mills
Steel Dynamics and Nucor Guide to Higher Q1 Earnings
Written by Sandy Williams
March 19, 2020
Steel Dynamics and Nucor are both expecting improved earnings for the first quarter of 2020 due to higher steel prices and increased shipments.
So far, the impact from the COVID-19 outbreak has been minimal on supply chains and operations, said the companies. Disruptions are expected, however, as more manufacturers temporarily suspend production and construction activity slows. Steel Dynamics and Nucor continue to monitor the situation and to address the safety of employees.
Steel Dynamics
Steel Dynamics expects first-quarter earnings from the company’s steel operations to be “meaningfully higher” than fourth quarter. Increased shipments and higher average quarterly steel pricing are expected to offset rising scrap costs, resulting in a steady metal spread, said SDI. Earnings are expected to be in the range of $0.83 to $0.87 per diluted share compared to sequential fourth-quarter earnings of $0.67 per diluted share.
Earnings for Steel Dynamic’s steel fabrication operations are expected to decrease from near record Q4 results due to seasonally lower shipments.
“The customer order backlog for the company’s steel fabrication platform is at a record high level and customers currently remain constructive concerning nonresidential construction projects. At this time, projects have not been delayed or canceled,” said Steel Dynamics.
The company said it is too early to determine the negative impact the COVID-19 outbreak will have on steel demand. Temporary closures of steel consuming businesses are expected to affect order activity in the coming weeks. SDI believes trade protections are strong enough to continue to limit the flow of unfairly traded steel imports into the U.S. during the crisis.
Nucor
Nucor expects higher first-quarter earnings in the range of $0.95 to $1.00 per diluted share compared to $0.35 per diluted share in the fourth quarter of 2019.
Higher average selling prices for Nucor’s sheet, bar and plate mills, along with higher volumes are expected to drive earnings. Results for the steel products segment are expected to decline due to normal seasonality. Higher raw material pricing and improved performance at Nucor’s DRI facility should result in improved results for the company’s raw materials segment.
“Order rates, backlogs and utilization rates at our steel mills have remained strong well into March, which reflects strong underlying demand in nonresidential construction and other end-use markets,” said Nucor.
Sandy Williams
Read more from Sandy WilliamsLatest in Steel Mills
ArcelorMittal posts solid results as commissioning of Calvert EAF begins
AM/NS Calvert has begun commissioning its new electric-arc furnace, with plans to reach its full annual run rate of 1.65 million short tons a year from now.
Tampa Steel Conference: Tanners on rising capacities and storms brewing across steel
There's a lot of production waiting to come online
USS idles “B” battery at Clairton following explosion
U.S. Steel has idled its "B" Battery at its Clairton Coke Works near Pittsburgh following a “release of excess pressure” inside a section of the battery on Feb. 5.
ArcelorMittal to start building Calvert NGO electrical steel line this year
ArcelorMittal announced on Thursday that it will begin the construction of its new $1.2-billion electrical steel mill in Alabama later this year. The steelmaker said it is proceeding with plans to build the new greenfield mill near its existing AM/NS joint venture in Calvert, Ala. The ArcelorMittal Calvert plant will have an annealing pickling line, […]
AISI: US steel shipments rise in December
Domestic steel shipments increased month over month and year on year in December, according to the latest data from the American Iron and Steel Institute (AISI). US steel mills shipped 7,145,016 short tons (st) in December, up 0.9% from 7,082,921 st in December 2023 and 6.6% higher than 6,702,557 st in November 2024. For the full-year […]