Nucor Steel Margin Calculator
When Nucor, the largest steel producer in the U.S., starts losing ground, the whole industry takes notice. It’s not just about one company’s quarterly earnings - it’s about what’s happening to American steel as a whole. In late 2025 and early 2026, Nucor’s stock fell over 22% in just six months. That’s not a blip. It’s a signal. And the reasons go deeper than headlines about tariffs or layoffs.
Steel prices are collapsing - and Nucor can’t escape
Nucor built its reputation on efficiency. Its mini-mills use scrap metal and electric arc furnaces, cutting out the need for massive, expensive blast furnaces. That model worked great for decades - until global oversupply hit. China’s steel production didn’t shrink. It just slowed down enough to flood export markets. Now, imported steel - often sold below cost - is pushing U.S. prices down. In December 2025, hot-rolled coil prices dropped to $680 per ton, the lowest since 2020. Nucor’s margins, which used to sit around 18%, are now down to 5.3%. That’s not a typo. That’s survival mode.
Unlike integrated mills that lock in long-term contracts with auto makers and builders, Nucor sells mostly on the spot market. That means it feels every price swing immediately. When demand dips, prices tumble, and Nucor has no buffer. Other steelmakers can wait. Nucor can’t.
Energy costs are eating profits
Electric arc furnaces need a lot of electricity. And in 2025, electricity prices in the Midwest - where most of Nucor’s plants are - jumped 34% compared to 2023. That’s not inflation. That’s grid stress. Renewable energy growth has been good for the planet, but it’s made the grid less stable. When wind and solar drop off, utilities turn to expensive natural gas peaker plants. Nucor’s power bills went from $120 million a year in 2022 to $161 million in 2025. That’s $41 million gone - right out of operating cash.
And there’s no easy fix. You can’t just switch fuel sources. Electric arc furnaces don’t run on diesel or coal. You can’t install solar panels on every mill and expect to power a 2,000-ton melt. Nucor tried battery storage pilots in Indiana. They helped a little - but not enough to offset the cost spike.
Competition isn’t just from China - it’s from inside the U.S.
People think Nucor’s biggest rival is ArcelorMittal or POSCO. But the real threat is smaller, smarter, and closer. Companies like Steel Dynamics and Reliance Steel are using AI-driven production scheduling to cut waste by 12%. They’re using predictive maintenance to reduce unplanned downtime. Nucor still relies on legacy systems. Its digital transformation has been slow. While competitors are cutting costs with machine learning, Nucor is still training workers to spot cracks in slabs with their eyes.
And then there’s the rise of direct metal suppliers. Companies like MetalSupermarkets and online platforms like MakeItFrom.com let small fabricators buy steel by the pound - no minimums. That’s cutting out the middlemen Nucor used to sell to. Now, Nucor’s biggest customers - local job shops and machine shops - are buying direct from producers in Mexico or Canada, skipping Nucor entirely.
Construction and manufacturing demand is flatlining
Steel demand doesn’t come from thin air. It comes from buildings, bridges, cars, and appliances. And right now, all three are slowing. The U.S. housing market is stuck. Starts in December 2025 were down 9% from 2024. Commercial construction? Even worse. Office vacancies hit 21% nationwide - the highest since the 1990s. That means fewer steel beams needed.
Automakers are shifting to aluminum and composites. Ford, GM, and Tesla now use less steel per vehicle than they did five years ago. That’s not a temporary trend. It’s structural. And Nucor doesn’t make aluminum. It doesn’t make carbon fiber. It makes steel. And steel isn’t the future anymore - not the way it used to be.
Worker shortages and wage pressure are squeezing margins
Nucor’s plants used to run with lean teams. But skilled mill operators are retiring. Fewer young people are entering the trade. The average age of a Nucor furnace operator is now 52. That’s not sustainable. To keep people, Nucor raised wages by 14% in 2024 - the highest increase in its history. That’s great for workers. But it’s a nightmare for margins. Labor now makes up 28% of Nucor’s operating costs, up from 21% in 2020.
And it’s not just wages. Safety compliance costs have doubled since 2021. OSHA inspections are more frequent. Training requirements are stricter. Each new safety protocol adds $1.2 million per plant per year. Nucor has 22 mills. That’s $26.4 million just on compliance - money that used to go into R&D or automation.
What’s next? Nucor’s gamble on hydrogen and EVs
Nucor isn’t giving up. It’s betting big on two things: hydrogen-based steelmaking and EV supply chains.
Hydrogen direct reduction (H-DR) is the holy grail. Instead of coal, you use green hydrogen to turn iron ore into steel. No CO2. Nucor partnered with H2 Green Steel in Sweden and is building a pilot plant in Louisiana. But it’s expensive. The project will cost $1.8 billion. And it won’t produce steel until 2028. That’s two years away - and in the meantime, margins keep shrinking.
Meanwhile, Nucor is trying to become the go-to supplier for EV battery casings and motor housings. That’s a smart move. EVs still need steel - just not as much. The problem? Nucor’s mills aren’t set up for high-precision, thin-gauge steel. Tesla and Rivian are working with European suppliers who can make 0.5mm sheets with zero tolerance. Nucor’s best is 1.2mm. That’s not enough.
Is Nucor doomed?
No. But it’s at a crossroads. The old model - cheap scrap, fast turnaround, low overhead - worked for 50 years. But the world changed. Prices are lower. Energy is pricier. Workers are harder to keep. And customers are looking elsewhere.
Nucor still has one advantage: cash. It has $4.2 billion in liquidity. No debt. That gives it time. But time isn’t infinite. If hydrogen doesn’t scale by 2030, or if EV steel demand doesn’t pick up, Nucor will have to shrink. That means closing plants. That means layoffs. That means becoming a smaller, slower company.
For now, Nucor is still the biggest. But it’s no longer the fastest. And in steel, speed matters more than size.
Is Nucor going out of business?
No, Nucor is not going out of business. It has no debt, $4.2 billion in cash, and a strong brand. But it is facing its toughest period in 40 years. Without major shifts in technology or demand, it will likely shrink its operations and focus on fewer, more profitable products.
Why is Nucor’s stock falling faster than other steel companies?
Nucor is more exposed to spot market prices than integrated mills like U.S. Steel. It doesn’t have long-term contracts to buffer price drops. It also has higher energy costs because its mills are concentrated in the Midwest, where electricity prices surged. Competitors like Steel Dynamics have moved faster on automation and customer direct sales.
Are tariffs helping Nucor?
Not enough. Tariffs on Chinese steel helped in 2022 and 2023. But by 2025, China shifted exports to Mexico and Vietnam, which then shipped into the U.S. under lower tariffs. The U.S. government hasn’t updated its trade rules to cover these loopholes. So while tariffs look good on paper, they’re not stopping the flood of cheap steel.
Can Nucor compete with electric vehicle makers who use aluminum?
Not yet. EV makers like Tesla and Rivian use aluminum for body panels because it’s lighter. But Nucor is trying to break into EV battery casings, motor housings, and structural frames - areas where steel still wins for strength and cost. The problem is Nucor’s mills aren’t built for ultra-thin, high-strength steel. That’s a gap its competitors are filling faster.
What’s the biggest risk to Nucor’s future?
The biggest risk is delay. Hydrogen steelmaking is promising, but it’s still experimental. If it takes until 2030 to scale - and demand for traditional steel keeps falling - Nucor will be stuck with aging mills, high costs, and shrinking customers. The window to transform is closing fast.