Steel Mills

Nucor Reports Earnings of $356.9 Million

Written by John Packard

With consolidated sales of $4.82 billion which is a 30 percent increase over 1Q 2016 and net earnings of $356.9 million it was a good 1st Quarter 2017 for the company. The company reported that the second quarter earnings should exceed that of 1st Quarter.

The overall operating rates at the Nucor steel mills was 89 percent compared to 74 percent in 4th Quarter 2016 and 80 percent during the 1st Quarter 2016.

Even so, Nucor had time to discuss the trades cases concerning imports of cut-to-length plate, rebar and steel wire rod as the company makes sure that they can compete on a level-playing field.

Nucor CEO John Ferriola, in their earnings conference call, spoke about the meeting he had today with President Donald Trump as he signed the Executive Order directing the US Department Commerce to investigate steel imports and its impact on the security of the United States and key national industries.

Ferriola reported that the President was “engaged” as was Secretary Ross. Nucor “welcomes an investigation” as “many of these steels are traded illegally violating our trade laws.” He continued with, “All we want is a level playing field.”

Regarding scrap, Ferriola reported that pig iron prices have been moving lower as has iron ore in the seaborn market. He believes scrap prices would not have any major moves during the remainder of the year and could well head lower.

He spoke of the energy business where rig counts have doubled off the lows and, he advised those on the call that the number of tons per rig have also doubled. “That’s a good situation for us.”

When looking at the three major movers of steel: construction, automotive and energy are all looking good according to the Nucor CEO.

Nucor expects to break ground on their joint venture with JFE out of Japan for a 400,000 tons automotive galvanized sheet mill in Mexico.

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