Data center construction drove demand for long steel in the quarter latest quarter, helping US long steel manufacturer Commercial Metals (CMC) widen its margins to a three-year high.
CMC shipped 716,000 short tons (st) of rebar and merchant bar in December-February, down by 4pc from the prior year quarter because of production issues stemming from this year's harsh winter, according to the Texas-based company's quarterly results released Thursday.
CMC's steel selling price rose by 20pc to $974/st compared with the three months ending February 2025, more than offsetting the slip in steel shipments.
The electric arc furnace steelmaker's scrap costs rose to $351/st, up from $334/st a year earlier. The steeper rise in steel prices, supported by tariffs, helped expand CMC's margins to a three-year high of $623/st, a 31pc increase from a year earlier.
Rebar prices have hovered at three-year highs in the US this year. Argus assessed rebar ex-works US Midwest at $920-960/st last week.
CMC noted that numerous scheduled maintenance outages at its steel mills this spring could reduce steel output in the current quarter ending in May. But it expects shipments to rise coming out of the winter months as construction season picks up pace.
The extreme temperatures and heavy snowfall in the eastern US this winter delayed construction at CMC's West Virginia mini-mill, the company said. It is still scheduled to start up in June.
The company has seen an uptick in rebar supply as additional North American capacity comes on line. Demand has kept up with the new supply so far, CMC said. Data center building for the artificial intelligence sector has been driving growth, as well as spending on energy projects. It expects those trends to continue.
The company has had no major impacts from the Iran war at its US operations. Its steel mill in Poland has faced some higher natural gas costs. But Poland's electric grid runs mostly on coal, limiting effects to CMC's energy costs associated with the war.
CMC made a $93mn profit in the latest quarter, up from $26mn in the same quarter a year earlier.
