Bloomberg) -- When Cleveland-Cliffs Inc. quietly submitted its takeover bid for United States Steel Corp. it couldn’t have chosen a more fitting day. That morning, July 28, US Steel Chief Executive Officer David Burritt was sounding as bullish as can be, predicting a once-in-a-generation boom that promises to send demand soaring.
[All because of Biden’s IRA!]
For much of the past 15 years, steel was a tough sell to investors who had grown jaded over persistent global gluts and cheap imports. Now, with America’s most iconic steel company in the middle of a potential bidding war, there’s a growing spotlight on the prospect of a boost in domestic steel demand from President Joe Biden’s landmark Inflation Reduction Act.
“It’s a manufacturing renaissance act,” US Steel’s Burritt said on his July conference call. “We are on the cusp of a once-in-a-generational steel cycle.”
[And it’s because the IRA is GREEN!]
A key attraction of US Steel is its exposure to the US auto market, traditionally the most profitable part of the industry. And unlike Cliffs, US Steel has made a huge bet on transitioning its business from blast furnace steel production — where iron ore and coking coal are combined to make primary steel in a highly polluting process — to electric-arc furnaces, where steel scrap is remelted in a much less polluting way.
[Unbelievable.]
US industrialists have been singing the praises of the IRA, an infrastructure deal that offers generous subsidies to domestic manufacturers of green technology such as electric-vehicle batteries. The act may drive stronger steel demand in the US, particularly from the metals-intensive renewable energy sector. Steelmakers also will benefit from tax credits for their decarbonization goals.
[US industrialists “singing the praises” of a Democrat and a Green New Deal! Unbelievable.]
But there may be more twists to come: US Steel said over the weekend it had received multiple approaches for part or all of the business.
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Now, it’s the outlook for steel in the US that is getting the industry excited.
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…said Tom Price, head of commodities strategy at Liberum Capital: “This is a really good time to buy metal processing. It’s been a really bad industry for 40 years and suddenly they’re doing something very important.”
Joe Biden, in under three years!:
1) has completely turned around the U.S. economy;
2) has worked the greatest revolution in the auto-steel sector since Eisenhower;
3) “astonishingly” (see Sunday’s post) has put the U.S.. and the world on the path out of the global climate crisis.
4) is the most accomplished POTUS in over two generations.