Market Segment
March 16, 2016
Steel Dynamics Expects Strong Quarter
Written by Sandy Williams
Steel Dynamics anticipates stronger earnings results in first quarter 2016 due to higher steel shipments. A significant increase in flat rolled product volume is expected due to better aligned customer inventories and a decrease in import volumes.
Lower average realized steel product pricing will more than offset savings from lower ferrous scrap costs, said SDI. Continued improvement is seen in the automotive and construction markets while heavy equipment, agriculture and energy markets remain challenged.
SDI’s fabricated steel joist and deck business is seeing strong demand in a typically slow season, indicating growth in the nonresidential construction market. Fabrication shipments are expected to improve slightly from fourth quarter but profitability is expected to be relatively unchanged.
Metals Recycling results are expected to improve in Q1. SDI expects increased ferrous shipments due to higher steel production utilization rates and metal spread expansion based on higher ferrous scrap prices.
