Nucor Corporation: Competing Against Low-Cost Steel Imports

Group E

Charisse Cohen
Valarie Lindsey
Teshaunte Lyons
Billy Ray Richardson

MGT 590: CAPSTONE—COMPETING GLOBALLY

Dr. Raman Patel – Professor

August 17, 2009
Nucor Corporation: Competing Against Low-Cost Steel Imports
Written Analysis

Executive Summary

This report discusses the challenges that The Nucor Corporation faces during this era of social and economic climate change. Using Porter's Five Forces Analysis and Four Generic Strategies, we will assess the steel industry standards as it relates to the strategies implemented by the Nucor Corporation. We will also assess what Nucor’s strengths and weaknesses are, and if they will be able to continue …show more content…

The use of steel has been marketed to building owners, architects, and contractors for commercial building since 2005, which accounts for 34% of the construction spending. But, the forward thinking to incorporate steel in the building of homes has become a favorable force in steel production. In 2006, the rise in demand has the potential growth for 3.25 million tons of new steel to be produced annually. The construction of homes using steel equates to half of the steel construction market at 50%. Lastly, constructing homes using steel serves a dual purpose in building the strength of homes through steel framing and steel roofs. The final force that is correlated to the innovative uses of steel is the increase in worldwide demand, which rose by 6% since 2000. Although, growth has been experienced throughout the 6 yeas span between 2000-2006 demand still fell short of capacity of steel products. Worldwide sales of steel products were in the high seven hundred billions ranging from $770-$790 billion. This upward trend in increased demand is a favorable trend in the steel industry. The chart below depicts the inequality in trading amongst the steel industry and the volatility of the consumption of steel.

FIGURE 1.3 [pic]

The chart above shows the inability of the U.S. market to obtain equal trade opportunities. The foreign trade is about 3 times that of the U.S., which indicates the level of inequality