Dive Brief:
- Nucor, the largest producer of steel and scrap metal in North America, saw steel shipments reach 7.1 million tons in the second quarter, marking a record-high as prices continued to increase from tariffs.
- Shipments climbed 1% from the previous quarter and 10% from a year ago. Nucor posted double-digit percent increases across bars, plates and other steel products over last year. Sequential growth from the previous quarter came mostly from plates.
- The Charlotte, North Carolina-based company posted net earnings of $1.2 billion, a 92% increase from a year ago and well above its June guidance. Nucor said it expects higher earnings in the third quarter but did not disclose a specific range.
Dive Insight:
U.S. steel producers this year have largely benefited from the Trump administration’s Section 232 tariffs, which placed a 50% tax on imported goods made almost entirely of aluminum, steel or copper. As a result, fewer steel imports have entered the market and commodity prices have significantly increased.
Cleveland-Cliffs’ average selling price for steel recently increased to $1,124 per ton, up $76 from the previous quarter. At the same time, demand for domestic steel has been steady. Shipments to automotive customers were the highest they’ve been in the past two years, Cleveland-Cliffs CEO Lourenco Goncalves said last week on an earnings call.
He touted Section 232 as the “single most effective industrial policy implemented in our country in a generation.”
Nucor, a maker of steel and fabricated steel products such as joists and girders, saw sales reach $10.4 billion during the second quarter. Sales increased 9% from the previous quarter and 23% from a year ago.
“Investment across key sectors of the U.S. economy, combined with supportive federal trade policies, drove a second consecutive quarterly record for Nucor steel mill shipments,” Nucor CEO Leon Topalian said in a statement.
The steel mills segment posted earnings of $1.6 billion. That was up 38% from the previous quarter and nearly double what it made during the same period last year. The segment’s results were offset by $430 million in corporate overhead expenses.
Nucor’s average selling price for steel was $1,145 per ton, up $71 from the previous quarter.
In addition to Nucor, competitor Steel Dynamics saw steel shipments reach a record-high 3.7 million tons in the second quarter.
Nucor also saw a $61 million non-cash, pre-tax benefit related to its investment in fusion energy company Helion. In 2023, the companies formed a partnership to develop a 500-megawatt nuclear fusion plant that provides zero-carbon electricity to one of Nucor’s steel mills. They are looking to begin operations in 2030.
“We continue to execute our growth strategy through investments to expand our capabilities and strengthen our position as the market leader with the most diverse portfolio of steel and fabricated products in North America,” Topalian said in a statement.
Nucor ended the quarter with $2.7 billion in cash on hand and repurchased 1.5 million shares at roughly $229 per share.
Looking ahead, Nucor is expecting higher earnings in the third quarter driven by steady demand and higher prices across its steel mills and steel products segments. At the same time, it is expecting lower earnings and margins from its raw materials segment.
