1. Blockbuster profits: The trade war has cast a shadow over parts of Corporate America, but it is bringing a bit of good fortune to the steel industry.
President Donald Trump’s metal tariffs have sent steel prices surging and sparked blockbuster profits for steel manufacturers.
Reliance Steel & Aluminum hauled in record sales, thanks to an 18% spike in prices. Nucor recorded the best second quarter in its history. Its profit more than doubled.
“All in all, we’re very happy with tariffs,” Nucor CEO John Ferriola told analysts earlier this month.
Those words haven’t been uttered by many other corporate bosses, who are grappling with sticker shock.
Tariffs levied by the United States and major trading partners are eating into the profits of Harley-Davidson, General Motors, General Electric, 3M and hundreds of other companies. CEOs are scrambling to raise prices and reshuffle their supply chains.
Unsurprisingly, steel companies are feasting on a price spike from Trump’s 25% steel tariff. The benchmark price of US-made steel has zoomed 41% higher since the start of the year to $917 per short ton, according to S&P Global Platts.
Tariffs aren’t the only factor. Steel demand is strong in an economy that just clocked its fastest growth since 2014.
Following the booming profits from Nucor and Reliance, US Steel and AK Steel are scheduled to report results this week.
Both steel makers are expected to reveal a jump in revenue, though not by as much as their rivals. That’s because US Steel and AK Steel are locked into annual contracts that have fixed pricing. Those contracts expire later this year, potentially allowing them to capitalize on the price hikes.
Nucor is seizing on the momentum to plow $1 billion back into its business, a huge increase that will mostly go toward expansion.
“What will happen to our great country if we…