The presidential campaign trail is filled with a lot of lip service and promises typically go unfulfilled. This isn’t breaking news to anyone.
Looking back to the campaigns that took place before the 2016 election, President Trump built a platform on reviving the U.S. manufacturing sector. Over the course of his administration took several measures to help the ailing industry, including imposing tariffs on U.S. steel imports. Though the president claimed that the U.S. steel industry was “thriving”, Wall Street said otherwise under his watch, but that wasn’t the case.
So, as we sit on inauguration day, with newly inducted President Biden promising similar efforts to manufacturing and infrastructure, in general, what will a Biden presidency mean for the steel industry?
As Market Realist points out, shares of U.S. Steel Corporation (X) fell 34% during Trump’s presidency, and Nucor (NUE) gained just 4%, while Steel Dynamics (STLD) rose 23%, but still underperformed the S&P 500 by a wide margin.
While Biden has given no indication he’ll put an end to the tariffs, entering his term, Biden has vowed to offer more stimulus, which could be beneficial for the U.S. economy in the short term, and the steel sector, by proxy. If the administration scales up infrastructure investments, as he’s promised on the campaign trail, we would certainly see a spike in the demand for steel, aluminum, and copper.
Following through on these promises while keeping pressure on Chinese trade could be more than enough to drive much-needed momentum into the steel industry in 2021.