Sydney: Shares of BlueScope Steel Ltd (BSL.AX) soared to their highest level in over three months on Monday following U.S. President Donald Trump’s announcement of plans to double tariffs on imported steel. The move has sparked optimism for Australian steel producers with strong U.S. exposure.
BlueScope, which operates five businesses in North America, including the North Star steel mill in Ohio, saw its stock jump as much as 9.4% to A$24.88 during early trading. The surge made BlueScope one of the standout performers on the ASX 200 index (.AXJO), even as the broader benchmark dipped 0.4%.
On Friday, Trump stated his intention to double tariffs on imported steel and aluminium to 50%, intensifying trade tensions and placing additional pressure on global steelmakers.
According to Grady Wulff, a market analyst at Bell Direct, “These proposed tariffs could bode well for BlueScope in enhancing steel prices in the U.S., thus driving tailwinds for the company.”
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The steelmaker’s shares had also risen 12% in mid-February after CEO Mark Vassella highlighted the company’s potential to benefit from Trump’s protectionist trade policies. However, since then, the stock had dropped nearly 10%, weighed down by market volatility and concerns over global demand.
“Uncertainty of a rebound in demand from China for steel and steelmaking ingredients has weighed on all companies with exposure to this market,” Wulff added. She also noted that the evolving tariff landscape has increased uncertainty around the recovery of demand for steel-related materials.
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BlueScope has also been impacted by declining iron ore prices, which have fallen 3.5% so far this year. Despite these headwinds, the company’s North American operations remain its most significant revenue contributor. In the six months ending December 31, 2024, the region generated 42% of BlueScope’s underlying earnings before interest, taxes, depreciation and amortisation (EBITDA), totaling A$309 million (US$199.77 million). Australia accounted for 39% of EBITDA, or A$288 million.
Trump’s tariff plan, if implemented, could provide a much-needed boost for BlueScope’s U.S. operations as higher domestic steel prices would likely increase margins and competitiveness for North American mills.
