Dallas, Texas 05/21/2014 (FINANCIALSTRENDS) – U.S.-made iron and steel products manufactured by United States Steel Corporation (NYSE:X) and Nucor Corporation (NYSE:NUE) could see increase in demand following a $12.3 billion water projects bill passed by the U.S. House. Lawmakers said that the new bill will allow dredging to accommodate larger ships through the expanding Panama Canal.
This will mark the first such water infrastructure bill since 2007 which would authorize more than 30 projects including dredging, environmental restoration, flood control and hurricane recovery. The way major U.S. shipping projects are funded would see a significant revamp following the Water Resources Reform and Development Act.
The measure would allow expansion of many U.S. ports which handle super freighter and the expanded capacity would reduce shipping costs for exporters including United States Steel Corporation (NYSE:X) and Caterpillar Inc. (NYSE:CAT). In addition, it will allow ports to pay the up-front cost of deepening harbors and seek reimbursement from the government following project authorization by lawmakers.
Delivers Profit Despite Production Issues:
America’s largest steel maker by volume, United States Steel Corporation returned to a profit in 1Q14 which was largely attributed to higher commercial prices for its products and the company’s cost cutting program. However, adjusted EPS of $0.25 for 1Q14 missed consensus estimates of $0.31 per share by significant margins of 19%. The lower than expected EPS was largely attributed to higher than expected operating costs mainly resulting from logistical challenges and weather related issues on the Great Lakes considerably impacted 1Q14 result.
United States Steel Corporation (NYSE:X) continued face production issues both at Gary Works and Great Lakes. Gary Works is facing issues over tight iron ore availability; however, it is now running three of four blast furnaces. Great Lakes Works remains offline given the ongoing work on a collapsed roof.
On Tuesday, the stock closed at $23.98, losing 4.42% from its previous close.