(Bloomberg) — When the world’s biggest aluminum- and steel-makers report first-quarter earnings, investors are hoping they’ll offer a window into how President Donald Trump’s tariff measures will ripple through the industry in the coming year. 

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The administration’s 25% levy on imports of the metals have jolted prices higher in the first quarter, boosting the financial outlook for US producers. But Trump’s subsequent, sweeping trade measures targeting a broad range of imported goods is clouding the longer-term outlook. That has left investors hungry for guidance just as some are forgoing forecasts altogether.

“The future impact of tariffs on demand, especially on sensitive industries such as automotive, will be key,” said Timna Tanners, an analyst at Wolfe Research.

Steel and aluminum are ubiquitous in advanced economies, used in everything from automobiles and tractors to skyscrapers and toasters producers. That heavy use offers investors a fair gauge into the health of the economy. Yet, huge uncertainty caused by the Trump administration’s tariffs threaten to undermine these industries, putting a damper on demand for the metal producers.

For now, analysts are sanguine about the impact of tariffs on US producers through the first half of 2025, with Nucor seen posting its first year-over-year revenue growth in 10 quarters in the second quarter, and United States Steel Corp. clinching its first in 11. Cleveland-Cliffs Inc. will see a similar turnaround after five straight quarters of shrinking sales. 

That’s because pricing gains are expected to “far outweigh” any reduction in volume caused by the tariffs, lifting second-quarter guidance for US steel-makers, said Philip Gibbs, metals equity research analyst at KeyBanc Capital Markets. 

Yet a significant economic slowdown triggered by Trump’s broader trade war could destroy demand and negate those gains later in the year, according to Jefferies. 

That’s reflected in the performance of the S&P Composite Steel Index, which is down for the year despite benchmark steel prices jumping over 30%. Shares of most of the US players dropped after the reciprocal tariffs were announced on April 2. 

Alcoa (AA), the largest US aluminum producer set to report first-quarter earnings on Wednesday, is among companies facing headwinds despite benefiting from higher prices. Its adjusted earnings before interest, taxes, depreciation, and amortization surged almost sixfold in the first quarter, according to estimates, as prices for aluminum and alumina climbed 20% and 60%, respectively.

But those gains “only partially offset” the costs of U.S. tariffs on aluminum imported from Alcoa’s Canadian operations, wrote Bloomberg Intelligence senior analyst Richard Bourke. About 36% of its smelting capacity is based in Canada, compared to just 13% in the US, according to the company’s latest annual report. 

Asia Hit Hard

In contrast to US producers, Asian steelmakers including South Korea’s POSCO Holdings Inc. and Japan’s Nippon Steel Corp. (5401.T, NPSCY) will face more headwinds because of US tariffs. The levies are seen exacerbating a supply glut at a time of weak regional prices. 

“Net-net, it is a negative,” said Grant Sporre, Bloomberg Intelligence’s global head of metals and mining. 

One upside is that Beijing is expected to roll out stronger stimulus measures to support the domestic economy in coming months, benefiting companies including Baoshan Iron & Steel Co. Ltd., a unit of the world’s biggest steelmaker. China mandating steel output cuts could buoy profits too. 

“China’s still the biggest consumer of metals,” said Sporre. “And they look very prime to try and offset any negative impacts from tariffs as much as they can.”

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