Steel producers tease Q1 earnings surge, citing higher prices

Dive Brief:

• U.S. steel producers are expecting a major jump in first quarter earnings due later this month, driven largely by higher sales volumes and prices as Section 232 tariffs on metal imports redirects demand toward domestic steel.
• Both Nucor Corp. and Steel Dynamics issued guidance in March that signal a roughly $1-per-share surge compared to the previous quarter. The surge would be even higher compared to the same period a year ago.
• The companies said their steel operations have seen significant demand growth since the end of 2025 as selling prices surpassed raw material costs and led to margin expansion. Morningstar analyst Seth Goldstein, who follows materials companies, said “we’re really starting to see the full effect of the tariffs on steel imports.”

Dive Insight:

The Trump administration’s tariffs on imported metals, such as steel, aluminum and copper, have rattled markets and forced manufacturers to reexamine their supplier relationships and strategies over the past year.

In June, President Donald Trump increased the steel and aluminum tariff rates to 50% under the authority of Section 232 of the Trade Expansion Act, which allows the president to impose tariffs on imports that threaten national security. He added copper to the program in July with the same tariff rate.

Earlier this month, he signed a proclamation that adjusted how the tariffs would be calculated, establishing that goods made “entirely or almost entirely” of imported metal would face the full 50% value. Derivative goods “substantially made” of imported metals would face a 25% levy, and even lower rates would be applied to electrical grid equipment and goods made abroad but entirely with U.S. metals.

Steel Dynamics, which uses recycled scraps as its primary input, told investors that its first quarter profitability will be “meaningfully higher” compared to its previous quarter. The Indiana-based company said demand has been strong in key end-markets, such as construction, energy and automotive.

It also highlighted that its steel fabrication segment’s customer order backlog is up more than 35% compared to a year ago, supported by commercial construction projects and data center and warehouse buildouts. Steel Dynamics said it expects sales volume improvement for the rest of the year, supported by “U.S. infrastructure and other stimulus programs and continued onshoring.”

Nucor said its first quarter earnings are expected to increase across its three operating segments — steel mills, steel products and raw materials — with the largest increase from steel mills. The North Carolina-based company is expecting earnings to be as high as $2.80 per share, up from $1.64 in the fourth quarter of 2025. Nucor reported earnings of 67 cents per share in the first quarter last year.

“They’re benefiting from competitors who may have been able to undercut prices through exporting cheaper production to the U.S. in the past, but now have to pay a tariff on steel,” Goldstein said.

“The domestic producers don’t [have to pay a tariff], meaning if all steel prices rise, that a lot of that flows to the bottom line for them,” he added.

Trump’s tariff actions and the U.S.-Iran war have significantly elevated steel prices as companies navigate supply shocks at the Strait of Hormuz.

In terms of how sustainable the elevated market conditions will be for U.S. steel producers, Goldstein said it depends on how long the tariffs are enacted and when shipping can fully reopen in the Middle East.

“We’re looking at disruption for most of 2026 to potentially disruption leading into the start of 2027 as well, so probably about the next year or so,” he said. “But of course, that’s all subject to how the conflict evolves.”

Steel Dynamics and Nucor plan to release their first quarter earnings in the coming weeks. They are scheduled to post their results after the markets close on April 20 and April 27, respectively, with plans to host a conference call the following mornings.