Steel Mills
NLMK USA: Higher Slab Prices Curb Revenue
Written by Sandy Williams
October 28, 2017
NLMK USA posted revenue of $424 million in the third quarter, a 3.0 percent decrease from the second quarter due to a 5.0 percent slide in the average sales price. Shipments increased 2 percent to 558,000 metric tons.
EBITDA for the segment was $38 million, down 9.0 percent from the second quarter due to higher slab purchase prices.
Demand in the U.S. was high in the third quarter due to stable demand from construction, automotive, and the oil and gas sectors, said NLMK. Demand is expected to remain stable in the fourth quarter and face less pressure from imports.
The global pricing environment is expected to be softer in the fourth quarter with lower Chinese exports lending price support.
NLMK Group increased steel output 6 percent from the second quarter driven by stronger demand by the Russian and international markets. Group steelmaking capacity utilization was at 100 percent, but is expected to be marginally lower in Q4 due to seasonality. NLMK estimates crude steel production for 2017 will total 17 million metric tons.
Sales volume for the group was 4.24 million metric tons for revenue of $2.5 billion, both flat with second quarter.
NLMK USA includes NLMK Indiana, NLMK Pennsylvania, and Sharon Coating.
NOTE: Steel Market Update will hold a Steel 101 workshop at NLMK Indiana in early spring 2018. Registration information will be posted on the SMU website soon.
Sandy Williams
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