US steel producers, including Nucor, Cleveland-Cliffs, and United States Steel Corp, rallied on Monday after President Trump announced tariffs on goods from Mexico, Canada, and China.
The White House imposed 25% tariffs on all Mexican and Canadian exports and a 10% levy on Chinese exports. This move is expected to boost domestic steel production by allowing companies to raise prices due to the increased cost of imported steel.
Nucor, Cleveland-Cliffs, and United States Steel Corp saw significant gains in pre-market trading, with shares rising double-digit percentage points. The companies are hopeful that trade restrictions will benefit the industry, as cheaper foreign imports could put downward pressure on domestic production.
Mexico and Canada are among the largest exporters of steel to the US, accounting for 35% of all imports. However, their exclusion from previous tariffs has led to a rise in cheap imports, particularly from Australia and Brazil.
Steelmakers, including Nucor and United States Steel Corp, have pushed for antidumping legislation to combat these cheap imports. The US Department of Commerce recently initiated investigations into corrosion-resistant steel products coming from various countries.
This development comes at a crucial time for US steelmakers, with Cleveland-Cliffs and Nucor joining forces to bid for US Steel, which was previously blocked by the previous administration due to a $15 billion takeover bid from Japan’s Nippon Steel.
Source: https://www.tipranks.com/news/u-s-steel-stocks-nucor-nysenue-and-cleveland-cliffs-rally-on-trump-tariffs