Higher steel prices bolstered profit at Cleveland-Cliffs Inc. (CLF), which reported its best quarter in three years. The company benefitted from President Trump's tariffs, which kept foreign steel out of America, observes Amber Kanwar, host of the In the Money with Amber Kanwar podcast.
The supply crunch has driven up steel prices to a four-year high and benefitted domestic producers like Cleveland-Cliffs. The company expects the good times to roll, with its profit forecast for the year nearly double consensus expectations. Cleveland-Cliffs says profit will be $4 billion for 2027 compared to the $2.4 billion expected by analysts.
The solid results come amidst a row with the Canadian government after Cleveland-Cliffs announced its subsidiary, Stelco, would indefinitely idle one of its product lines. That would lead to potentially 500 job cuts in Hamilton, Ontario.
But in the quarterly results, the Canadian division was actually a boon to the overall profit picture. So, why the job cuts?
The particular steel that is made in the Hamilton plant is meant for US consumption – and the tariffs make them uneconomical, according to the company. The Canadian government may have something to say about that considering the company just touted profit is expected to almost triple next year.