Steel Mills
U.S Steel Guides Higher for 2018 Due to Section 232
Written by Sandy Williams
March 13, 2018
U.S. Steel provided full-year 2018 earnings guidance on Monday in light of the recent Section 232 tariffs.
As a result of the imposition of a 25 percent tariff on steel imports, the company decided to resume steelmaking operations at Granite City Works with the restart of its “B” blast furnace. U.S. Steel anticipates incremental shipments of approximately 100,000 tons per month from Granite City Works once the restart process is completed. Benefits from Granite City will be reflected in the second half of 2018 as shipments increase and recent price changes become more fully realized for spot and contract volumes.
First-quarter EBITDA is expected to be approximately $250 million. Based on an assessment of market conditions resulting from Section 232 actions, U.S. Steel expects full-year EBITDA of approximately $1.7 billion, up from $1.5 billion previously.
In an analyst note, Key Banc Capital Markets said, “We believe the guidance takes into account U.S. sheet spot pricing cyclicality, including ~$750/ton HRC on average for the year, which is in line with the year-to-date spot average.”
Sandy Williams
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