UPDATE 1-Nucor says earnings may rise on higher demand
Sept 17 (Reuters) - Steelmaker Nucor Corp said on Tuesday its third-quarter earnings may rise from a year earlier, helped by improvement in demand as well as supply disruptions experienced by its competitors.
But Nucor also said its raw materials segment would likely report weaker results than in the second quarter because of higher start-up costs at its new direct reduced iron plant in Louisiana. It expects the plant to start production in the next few weeks. Direct reduction facilities convert natural gas and iron ore pellets into direct reduced iron, which can be used with scrap metal to produce steel products in electric arc furnaces.
Charlotte, North Carolina-based Nucor said it expects third-quarter earnings of 35 to 40 cents a share, compared with 35 cents a year earlier.
Analysts, on average, expect 38 cents a share, according to Thomson Reuters I/B/E/S.
Excess capacity has the global steel market under pressure, but production at several mills in the Americas has been disrupted in recent months.
Both AK Steel Holding Corp and ArcelorMittal's Indiana Harbor plant were forced to take blast furnaces offline this summer because of equipment failures, and a four-month lockout at U.S. Steel's Lake Erie works in Canada shut down raw steel production at that mill.
Nucor shares rose 1.4 percent to $49.79 in morning trading on the New York Stock Exchange.