Charlotte-based Nucor Corp., the largest U.S. steelmaker, cut its forecast for first-quarter earnings and blamed a surge in foreign imports for a drop in prices.
Profit will be 10 cents to 15 cents a share, the company said Thursday in a statement. Nucor said previously its earnings would be slightly higher than the 35-cents-a-share posted in the first quarter of 2014.
The revised projection was also much lower than the 40-cent average of 17 analysts’ estimates compiled by Bloomberg. The shares dropped as much as 6.3 percent in New York, the most intraday in more than three years, before closing at $46.10.
Nucor’s reduced outlook comes a week before Chairman and Chief Executive Officer John Ferriola is due to testify at a hearing of the Congressional Steel Caucus. He’s part of an industry delegation traveling to Washington to discuss the harm they say imported steel is inflicting on domestic producers even as U.S. demand improves.
Foreign-produced steel shipped to the U.S. rose 38 percent in 2014, and the trend has continued this year, Nucor said.
“Global overcapacity built by state-owned enterprises is the biggest risk factor to our business,” it said in the statement.
In July, the U.S. Commerce Department set import duties on steel pipes from South Korea and eight other countries, products that it said had been sold in the U.S. below cost in violation of international trade rules.
The U.S. steel industry is also feeling the effects of the oil-price slump, which has cut demand for metal used in pipes.
The price of hot-rolled steel coil, a benchmark product used in everything from kitchen appliances to cars and heavy machinery, has declined 23 percent in the last 12 months, according to data from the Steel Index Ltd.