Despite increases in the U.S. steel industry's operating rate from 60% to 73%, as well as Nucor's current 75% operating rate, the U.S. steel industry will only inch forward at best according to Nucor's CEO and President. End markets, according to the CEO, are still in poor form as the housing market continues to struggle with a 10% decrease in housing starts for the month of May along with a 32.7% decline in May home sales. Consumers of steel are tentatively watching the economy to see how conditions fair; as such, steel consumption will level off in the meantime.
Nucor relies on scrap steel for its production. Historically high scrap steel prices have persisted through 2006 and global demand for scrap steel may continue to increase which could drive prices up even further.