Steel Mills
Nucor Expecting Drop in Q1 Results Due to Import Impact
Written by Sandy Williams
March 19, 2015
Nucor Corporation expects first quarter results to “decrease significantly” compared to fourth quarter and exceed first quarter 2014 levels only slightly. High levels of imports have lowered selling prices and squeezed margins.
Nucor notes that total steel imports rose 38 percent in 2014 and account for 34 percent of the total domestic shipments last year. The trend has continued in 2015 with January import levels up 37 percent year over year. “Global overcapacity built by state-owned enterprises is the biggest risk factor to our business,” said Nucor in its first quarter earnings guidance.
The steel sheet market has been hit hardest, says Nucor. Pricing on hot-band has decreased another 19 percent from the end of 2014. Margins are expected to improve in second quarter as the company begins to realize benefits from lower raw material costs and stabilizing selling prices. Imports are expected to decrease in second quarter but remain at “excessively high levels.”
The slow but steady growth of the nonresidential construction market will help bolster growth of the downstream products segment in Q1 resulting in an increase year over year. Sequential results will be lower due to seasonality First quarter results in the raw materials segment will include an operating loss of $37 million due to idled operations at Nucor Steel Lousiana and declines in the scrap processing business and natural gas drilling interests.
Nucor Steel Louisiana operations have been idled since November 2, 2014 due to equipment failure of the process gas heater. Repairs are progressing and Nucor Louisiana is expected to be operational by the end of first quarter 2015.
Sandy Williams
Read more from Sandy WilliamsLatest in Steel Mills
Steel Summit 2024: Stelco CEO reflects on strategy, growth, and sale to Cleveland-Cliffs
In a candid fireside chat with SMU Senior Analyst/Editor David Schollert, Stelco’s CEO Alan Kestenbaum opened up about Stelco’s pending sale to Cliffs, his business strategy, outlook for the industry, and plans for the future. The chat took place on Tuesday, Aug. 24, at the 2024 SMU Steel Summit in Atlanta.
AISI: US steel shipments unchanged in July vs. June, down on-year
Domestic steel shipments remained nearly flat in July month over month but fell from a year earlier.
Media reports: Biden could block USS sale on national security concerns
President Joe Biden could block the $15-billion sale of U.S. Steel to Japan's Nippon Steel by citing national security concerns That’s according to reporting in the Washington Post and the Financial Times that was later picked up by the New York Times as well as in wire services.
USS threatens to cut ‘thousands’ of jobs, move HQ if Nippon sale blocked
U.S. Steel could slash thousands of jobs, shift away from integrated steelmaking, and move its headquarters out of Pittsburgh if its acquisition by Nippon Steel isn’t completed, the company’s top executive said. “We want elected leaders and other key decision makers to recognize the benefits of the deal was well as the unavoidable consequences if the deal fails,” company President and CEO David Burritt said in a statement on Wednesday.
CRU: SSAB to expand Mobile plate mill
SSAB plans to spend $12 million to boost production capacity at its electric-arc furnace (EAF) plate mill in Mobile, Ala. The Sweden-based steelmaker will do that by expanding the existing furnace there. Shot blast equipment will also be upgraded. The expanded capacity is expected to come online late next year. The mill currently has an […]