18 Jan

Can US Steel Production Continue to Favor CLF Stock in 2019?

WRITTEN BY Annie Gilroy FEATURED IN Company News, Insights, & Analysis and Basic Materials

US steel production

Domestic steel production is one of the major demand drivers for Cleveland-Cliffs’ (CLF) iron ore pellets. Therefore, in this part, we’ll discuss the progression of US steel production and the outlook.

Can US Steel Production Continue to Favor CLF Stock in 2019?

Steel production is on an uptrend

US steel production has been on a fairly upward trend after President Trump imposed Section 232 tariffs in March. In 2018, the US produced 95 million tons of steel, the highest level since 2007. 2018 production grew 6.2% YoY. The calculations are based on the American Iron and Steel Institute’s weekly steel production data until December 29.

According to the American Iron and Steel Institute (or AISI), the domestic mills produced ~1.9 million tons of steel for the week ended December 29. This production implies a surge of 13.3% compared to the production in the same week last year.

Capacity utilization

The capacity utilization in the US steel industry (X) is also on an upward trend, mainly due to declining imports. AISI reported that for the week ended December 29, the capacity utilization for steel mills was 81% compared to 71.9% a year ago. Import tariffs have helped the industry break above the level of 80% capacity utilization. However, with higher production and steel demand concerns from consumers, given higher steel prices in the United States (DIA), oversupply concerns have taken hold.

Credit Suisse (CS) downgraded the US steel sector amid these concerns. It downgraded Cleveland-Cliffs (CLF), Nucor (NUE), and Steel Dynamics.

In the next part of this series, we’ll see how tariffs are affecting US steel prices.

Latest articles

T-Mobile wants to showcase its strength before its first-quarter earnings release. T-Mobile is scheduled to report its first-quarter results on April 25.

Mondelēz (MDLZ) is scheduled to announce its first-quarter earnings results on April 30.

Freeport-McMoRan (FCX) is scheduled to release its first-quarter earnings on April 25.

23 Apr

How Ford Stock Is Faring ahead of Q1 Earnings

WRITTEN BY John Parker

Ford has risen 8.2% in April so far as compared to 2.6% gains in the S&P 500 Index.

23 Apr

Natural Gas Recovery Might Fade Away

WRITTEN BY Robert Scott

On April 22, natural gas prices settled at $2.52 per MMBtu—1.4% above the lowest closing level for active natural gas futures since June 8, 2016.

Kimberly-Clark (KMB) stock rose 5.4% on April 22 after the company released stronger-than-expected first-quarter results.