SDI Guidance Shows Strong Construction Demand

Steel Dynamics Inc. is expecting third-quarter 2020 earnings to be slightly better than the previous quarter due to stronger results from recycling and steel fabrication operations and lower costs associated with construction of the new mill in Sinton, Texas.

Steel operations earnings are expected to be lower in the third quarter. The division experienced metal spread compression during Q3, which more than offset increased shipments driven by improved automotive and construction demand, said SDI. Lagging price-indexed contracts, which offset lower average scrap costs, resulted in lower average realized quarterly flat roll steel product pricing. SDI notes that pricing stabilized and improved during the second half of the quarter, supported by customer demand and raw material pricing.