Deep sea mining puts $560 billion in land extraction at risk — report
Even in optimal scenarios, the activity would generate only $6.25 million in tax revenue for countries involved, says Planet Tracker.
Cleveland-Cliffs Inc. tumbled after the steelmaker failed to allay rising concerns that demand for the metal needed in everything from skyscrapers to cars and appliances is in a free-fall.
The second-largest US steelmaker said Tuesday that it is being hit by higher input costs and maintenance activities, which led to adjusted earnings before items of $436 million in the third quarter, about 50% below analysts estimates. Adding to the pain was analysts noting that Cleveland-Cliff’s implied earnings guidance was well below Wall Street’s estimates.
It’s been a brutal run for the steel industry this year, in particular the last couple of months since executives, traders and other industry participants struck an optimistic tone at the largest annual North American steel conference in August. Benchmark prices in the US are down about 47% since January as surging inflation and weakening demand hit an industry that had an unprecedented 2021.
Implied fourth-quarter adjusted earnings before items would be “$150 million to $200 million, versus our current $664 million and the Street’s $687 million,” Phil Gibbs, an analyst at Keybanc Capital Markets, wrote in a note to clients. He said half of the difference is due to lower sales while the rest is from higher conversion costs due to inflationary pressures.
Shares of Cliffs tumbled as much as 15% amid the biggest drop in six months before retracing about half of its losses, aided by CEO Lourenco Goncalves’s comments in a call with analysts that he expects automotive steel shipments to improve in the fourth-quarter. The jump in auto demand, Goncalves said, would return the company to a level of nearly 4 million tons of quarterly steel shipments — an improvement from the 3.6 million tons shipped last quarter.
Nucor Corp., the country’s biggest steelmaker, last week reported earnings that missed analyst estimates, also warning of economic uncertainty and inflationary pressures.
(By Joe Deaux)
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