Posted on 01 Sep 2021
Nippon Steel Corporation expects profits to beat recently upgraded guidance. The exalted results are mainly on account of rallying steel prices outside Japan and falling iron ore prices. The company had recently raised its profit guidance for the year, driven by boosted earnings from steelmaking units in India, U.S. and Brazil.
According to Takahiro Mori, Executive Vice President, Nippon Steel noted that the company’s overseas businesses have outperformed its expectations during the months of July and August. The situation in the U.S. too was better than what it expected to be. The company had expected the U.S. steel market to peak in July, but it has remained more or less tight.
The plunging iron ore prices too supported the outperformance, Mori added. Incidentally, the iron ore prices, which had peaked at above $230 per tonne in May this year fell to $140 per tonne in August. The prices are expected to recover modestly, but are unlikely to cross $200 per tonne mark.
The only risk comes from declining production by automobile manufacturers, which may badly impact steel demand.
Source:Scrap Monster
