2Q19 review: plate cost hike burdensome, rebar makers outperform
The combined parent operating profit of the primary metal companies in our coverage in 2Q19 will likely come down 8% YoY but up 6% QoQ. Our forecasts are mostly in line with consensus estimates.
We believe blast furnace names and flat product makers weighed on 2Q19 earnings, as steel prices could not keep up with rising iron ore prices. This is mainly due to the quarterly/half-yearly contract structure, weakness of Chinese dealer steel prices, and anemic domestic demand. On the other hand, electric arc furnace players