Stronger demand for BlueScope's higher-margin Colorbond and Zincalume products, driven by the east coast housing boom, and a recovery in steel spreads are also boosting earnings. Steel spreads, the difference between the cost of key steel-making materials iron ore and coal and the selling price of steel, are a key metric in the industry. BlueScope shares surged 14 per cent to $4.99 at 1.30pm AEDT on Friday. Perpetual portfolio manager Vince Pezzullo said the Port Kembla steelworks had embarked on a process of continuous improvement to stay internationally competitive. "We are at the bottom of the steel cycle in North America. In Australia it is all about costs," he said.