SDI forecasts marked decline in Q2 earnings

The Fort Wayne, Ind.-based company said profitability at its steel operations will be “meaningfully lower” sequentially, as lower realized pricing offsets steady shipments.

“Underlying domestic steel demand remains intact, although steel buying hesitancy has resulted from a weakening scrap price environment,” the company said, noting positive demand from the automotive, non-residential construction, energy, and industrial sectors.

SDI’s metals recycling operations had stronger sequential shipments of both ferrous and nonferrous materials, which boosted Q2 shipments higher than in the previous quarter.

Higher shipments offset slightly lower pricing in SDI’s steel fabrication operations. As a result, the company expects the segment’s Q2 results to be level with Q1.

Commenting on the fabrication segment, SDI said: “The non-residential construction sector remains solid, as further evidenced by steel joist and deck order backlog volume that extends into the fourth quarter of 2024, with historically strong associated product pricing.”

It added that “the continued onshoring of manufacturing, coupled with the robust US infrastructure program and industrial buildouts, support strong demand in the coming years.”