SSAB reports narrower margins this year

SSAB AB, which operates two recycled-content electric arc furnace (EAF) mills in the United States, has reported net income of about $224 million in this year’s second quarter, down from the prior quarter and the second quarter of 2023.

The Swedish metals producer saw its net income drop by 38.4 percent compared with the second quarter of last year ($364 million) and by 6 percent compared with the prior quarter ($238.5 million).

Overall revenue flowing into SSAB in this year’s second quarter was greater compared with its highly profitable second quarter of 2023 but dropped by 11 percent compared with the previous quarter.

“The [income] decrease compared to a year earlier was primarily due to lower U.S. heavy plate prices," says Martin Lindqvist, CEO of SSAB. "The market in Europe continued to be relatively weak, whereas the market for high-strength steel was more resilient.

“SSAB Americas’ operating result for the second quarter decreased [and] the operating margin was 19 percent (compared with 34 percent one year earlier) as prices weakened.”

In Europe, “The market was weak and the political strikes in Finland had a negative effect,” Lindqvist says. Offering better news, shipments to the car industry (automotive advanced high-strength steels) reached a record level.

Lindqvist characterized the market in Europe as “relatively weak during the second quarter,” noting the U.S. heavy-plate market weakened during the time frame.

“During the third quarter, SSAB will carry out planned maintenance at most production sites and this will be reflected in lower output,” he says. “SSAB Americas will bring forward the maintenance stop at the Montpelier [Iowa] mill. Demand is seasonally lower in the third quarter, especially in Europe, and the assessment is for a more pronounced decrease than normal.”

Regarding the quarter now underway, KLndqvist says, “SSAB Americas’ shipments are assessed to be significantly lower and prices are expected to be lower. The costs of raw materials are expected to be somewhat lower compared to the prior quarter.”

He says SSAB’s transformation to fossil-free steelmaking continues with a focus on the conversion of Oxelösund and the planning of the minimill in Luleå. The new mill in Luleå will reduce Sweden’s carbon dioxide emissions by 7 percent in addition to the 3 percent reduction from the conversion of the mill in Oxelösund.