The nation’s top metals processor says business has surged following the Trump administration’s tariffs on steel and aluminum imports.
“Improved demand, a limited amount of customer pre-buying as a result of announced tariffs, and normal seasonal patterns” pushed first-quarter shipments up 10 percent from a year earlier, yielding a record quarterly sales volume of 1.6 million tons, Reliance Steel & Aluminum Co. said Thursday.
The spike in pre-buying stems from “rapid price increases throughout the quarter and concern about metal availability,” said Gregg Mollins, the company’s chief executive officer. Revenue climbed 14 percent to $2.76 billion in the three months through March, Reliance said.
More broadly, however, U.S. industry continues to cite the potential harm from Trump’s tariffs of 25 percent on steel imports and 10 percent on aluminum. Both executives and economists have cautioned that the metals levies and subsequent duties on Chinese imports may lead to a trade war that crushes future profits and erases the benefits from last year’s tax cuts.
“Trade wars, more specifically tariff environments, aren’t necessarily good for us,” Union Pacific railroad CEO Lance Fritz said on CNBC. “We thrive when consumers buy things, when the industrial economy is thriving and healthy and when trade flows are thriving and healthy, and tariffs can affect all of that.”
Union Pacific on Thursday reported first-quarter net income of $1.3 billion on Thursday. Revenue for the first three months of the year was $5.5 billion, up 7 percent from the same time period in 2017.
While congressional Republicans expressed significant concerns over the tariffs, leadership has largely ruled out a legislative response and opted instead to work with the administration to minimize the impact. Since the initial announcement, the White House has excluded a number of countries from the metals tariffs, including Mexico and Canada.
