U.S. Steel Corp., one of the largest steelmakers in America, warned investors that accelerating economic headwinds are eroding demand for the metal.
The Pittsburgh-based producer said demand has dropped across most of its markets amid persistent supply-chain problems and higher costs for raw materials and energy in Europe. The company now is forecasting adjusted third-quarter earnings before items of about $825 million, more than 10% lower than the average of Wall Street estimates.
The downtrodden comments come a day after Nucor Corp., the largest U.S. steelmaker, sounded alarm bells that shipments of the key metal will be reduced during the current quarter. Over the course of little more than 24 hours, three major U.S. metal producers, including Alcoa Corp., warned investors of significant pullbacks in earnings, repeatedly citing softening demand and growing economic uncertainty among customers.
“Accelerating market headwinds in the third quarter negatively impacted demand across most end-markets, which is expected to result in lower shipment volumes,” the company said in a statement Sept. 15. “Supply chain issues in automotive and appliance end-markets continue, while containers and packaging has softened, and service center buyers remain on the sidelines.”
Late Sept. 14, the chief financial officer of Alcoa, the largest U.S. aluminum maker, said challenges include dropping metal prices even as raw-material prices remain “stubbornly high.” The comments come less than a month after executives, buyers, analysts and traders at the largest steel conference in North America struck an optimistic tone by saying the market was nearing a bottom.
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