Lower demand, DRI outage to hit Nucor in 3Q

US steelmaker Nucor expects its third quarter profit to fall on lower prices in its steel mill segment for flat-rolled and plate products.

The electric arc furnace (EAF)-based steelmaker, the largest in the US with a steel production capacity of 27mn st, said today in its third quarter guidance that lower demand from automotive, agricultural products and power transmission markets will weigh on its steel mill segment's performance.

Nucor expects third quarter earnings of 75-80¢/share, down by nearly two-thirds from the $2.13/share it earned in the third quarter of 2018.

Nucor also expects lower profits in its raw materials segment compared with the second quarter because of the shutdown of its 2.5mn t/yr direct-reduced iron (DRI) plant in Louisiana. The facility closed last week for maintenance, later than originally expected, with the shutdown expected to last until mid-November.

The company expects its steel products segment to improve profitability in the third quarter compared with the prior quarter on continued steady demand in the nonresidential construction market.