(Bloomberg) -- Caterpillar Inc (NYSE:CAT). fell more than 6 percent after reporting third-quarter earnings that topped analysts’ estimates while flagging concern over rising raw materials costs.
“Manufacturing costs were higher due to increased material and freight costs,” the company said in a statement Tuesday. “Material costs were higher primarily due to increases in steel prices and tariffs.”
Caterpillar, an economic bellwether expected to report record earnings this year, is feeling the pinch as trade frictions boost metal costs. The company has been trying to raise prices at a time when analysts say some end-user industries may be reaching peaks in their growth cycles. The International Monetary Fund this month warned of “choppy” waters in the global economy.
The cost of benchmark steel in the U.S. has risen almost 30 percent this year amid growing global demand and U.S. tariffs on the metal that have made domestic prices expensive compared with the rest of the world.
Caterpillar fell before regular trading in New York. The heavy-equipment maker dropped to the lowest closing price this year on Monday.