Cleveland-Cliffs Sees Earnings Recovery Firmly Underway as Trade Environment Favors Domestic Steel Industry

Cleveland-Cliffs' third quarter 2026 earnings conference call provided a glimpse into the company's robust recovery, with Chairman and Chief Executive Officer Lourenco Goncalves declaring that "the recovery is firmly underway." The company's adjusted EBITDA hit $612 million, more than double the $286 million generated in Q2, driven by improved shipments, selling prices, and costs. This resurgence has been attributed to a more rational trade environment in the United States, where foreign producers are no longer able to dump steel into domestic markets without consequences.

Goncalves emphasized that "a healthy domestic steel industry happens when trade laws are enforced" and cited the Trump administration's policies as instrumental in creating conditions for companies like Cleveland-Cliffs to invest in industrial communities and expand domestic production. The result is a stronger, more confident domestic steel industry, with higher utilization rates, more investment in steel facilities, and increased confidence from both steel producers and consumers.

Every conversation about reshoring manufacturing, rebuilding infrastructure, expanding energy production, strengthening the electrical grid, or supporting national defense starts with steel, Goncalves noted. At Cleveland-Cliffs, this means mining iron ore, producing pellets, and HBI, as well as producing steel from scratch with a 25,000-person workforce spanning some of the most important industrial communities in the United States.

With the renaissance of manufacturing in the U.S., Cleveland-Cliffs is currently selling steel under the best price environment in three years. This has provided a perfect storm for the company to grow employment, pay its workers well, reinvest in people and equipment, and protect critical supply chains and national defense.

The most significant development since the last call has been the strength of Cleveland-Cliffs' 2027 round of contract negotiations with clients. The largest portion of steel volume consists of tons sold to service centers and end users under annual fixed price or index-linked contracts, which cover every segment of light flat rolled steel consumption outside automotive. Nearly all customers want more steel under contract in 2027 than in 2026, generating over $1 billion of year-over-year EBITDA improvement.

Perhaps most importantly, the company's clients are not fleeing to imported steel, and Cleveland-Cliffs is finally operating within a fair commercial structure critical for sustaining a healthy business. This has created an opportunity to maximize the value of existing assets, with plans to postpone the Burns Harbor C blast furnace reline from mid-2027 to April 2028.

The modernization of Middletown Works and several other ongoing projects are also underway, signaling Cleveland-Cliffs' commitment to continuous investment and improvement. The company's financial health is reflected in its strong contract renewal environment, which bodes well for future growth and stability.