Steel Dynamics Looks to Strong Demand for Aluminum, Steel Operations

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Written by Danny Levin, Deputy Editor for IIR News Intelligence (Sugar Land, Texas)

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Summary

Steel Dynamics' aluminum and biocarbon/steel operations are on solid footing amid strong demand for both products in the coming year, company executives said Monday.

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Steel Dynamics' Financial Results

Mark Millett, the chief executive officer of Steel Dynamics (Fort Wayne, Indiana), pointed to success in the company's aluminum and biocarbon segments as part of the company's fourth-quarter and full-year 2025 earnings results: "We have successfully produced finished aluminum flat-rolled products for the industrial and beverage can markets, as well as hot band for the automotive sector."

The company's fourth-quarter net sales of $4.4 billion lagged behind third quarter's $4.8 billion but amounted to a 14% increase year over year ($3.87 billion). Net income of $266 million was less than last quarter's $404 million, but up from $210 million in fourth-quarter 2024.

Full-year 2025 net income of $1.1 billion was down from $1.55 billion in 2024.

Other results were more positive: net sales of $18.2 billion were up 3.6% from 2024's $17.5 billion. In addition, the company achieved record steel shipments of 13.7 million tons during the year.

The record shipments came as imports declined from the elevated levels seen during the first half of the year, and as year-over-year operating performance improved at the company's flat-rolled steel mill in Sinton, Texas.

Millett added: "Additionally, the SDI Biocarbon Solutions team is continuing to refine operations and increase production, providing a significantly lower-carbon supply chain opportunity for our steel and steel fabrication customers."

Also for the year, operating income from its metals recycling operations was $97 million, nearly 30% higher than 2024 due to improved pricing, volume, and operating efficiencies.

In the earnings call, he said aluminum will be a growth platform for the company, although that will not come at the expense of expanding its steel or any other businesses. Strong demand for the two products will continue into 2026, he predicted.

"Regarding the flat-rolled steel markets, prices have recently improved. Supported by stable demand and lower imports ... And we expect another solid year as demand and pricing remains strong, particularly in structural steel and railroad rail. Regarding the steel market environment, North American automotive production estimates for 2026 are expected to be similar to 2025."

Regarding aluminum, he indicated there's a significant domestic supply deficit of more than 1,400,000 tons for aluminum sheet, which is "forecasted to grow along with demand ... we've seen that there's clear alignment with many of our ... core competencies."

Company's Investment Strategy and M&A Activity

The company expects capital expenditures for 2026 to be about $600 million. In comparison, capital expenditures for 2025 reached $948 million.

SDI Biocarbon Solutions produced the first biocarbon at its steel mill in Columbus, Mississippi last year.

Last summer, Steel Dynamics began construction on a $100 million expansion of the biocarbon production facility, which currently produces 160,000 tons per year of biochar, a carbon-rich, biomass-based charcoal that is a renewable alternative to fossil-fuel carbon. The product is used to fuel electric-arc furnaces at the company's steel mills. The expansion, which is expected to wrap up toward the end of next year, will raise production to 480,000 tons per year. The initial project wrapped up in March 2025.

Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Plant and Project databases can learn more from a plant profile and read detailed project reports on the ongoing Phase II.

Steel Dynamics is seeking permits and regulatory approval for an aluminum-recycling plant in Benson, Arizona, which is being developed by its Aluminum Dynamics Incorporated unit. In December, the Arizona Department of Environmental Quality (AFEQ) approved an air permit for the proposed construction, although the application needs approval from the EPA before ADEQ can issue the final permit.

But there are other potential obstacles to construction: non-profit organization Health Over Wealth Benson last year filed a lawsuit to stop the development (a 200-acre site) due to permitting concerns, while local residents have expressed concerns regarding air quality, water usage and a lack of transparency from local officials.

In addition to project investment, "during the past five years, we have focused on strategic organic investments in steel and aluminum products," Millett said.

Millett confirmed the company completed its acquisition of the remaining 55% stake in New Process Steel (Houston, Texas). In discussing the purchase, Barry Schneider, president of Steel Dynamics, said the "steel fabrication platform provides meaningful volume support for our steel mills critical in softer demand environments, allowing for higher through cycle steel mill utilization compared to our peers."

But the company has been less successful with another acquisition: in early January, without any engagement, BlueScope Steel (Melbourne, Australia) rejected yet another unsolicited, non-binding takeover proposal from a consortium of Steel Dynamics and Australia's Seven Group Holdings (Sydney). The former would acquire the company's North American operations, which includes a flat-roll steel mini-mill in Delta, Ohio.

By the Numbers

• $18.2 billion: 2025 net sales were up 3.6% from 2024's $17.5 billion
• 13.7 million tons: record steel shipments during 2025
• $948 million: 2025 capex, with around $600 million expected this year

Key Takeaways

• Steel Dynamics' 2025 steel shipments and net sales improved year-over-year.
• The company aims to expand its aluminum and steel operations through both capital investment and M&A.
• SDI is attempting to acquire the North American assets of BlueScope Steel.

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About IIR News Intelligence
IIR News Intelligence is a trusted source of news for the industrial process and energy markets, powered by Industrial Info Resource's Global Market Intelligence (GMI).

About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 250,000 current and future projects worth $30.2 Trillion (USD).