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US President Donald Trump’s threatened steel tariffs that don’t kick in for two weeks are impacting US buyers who already are seeing American-made metal cost more than imports.
The benchmark price for domestic steel touched more than $900 a ton this week, up almost one-fourth this year, in anticipation of the imminent 25% levy on foreign supplies. That surge means US prices have now moved above par with imported steel, according to people active in the market who asked not to be named discussing non-public information.
“What we’re seeing so far happen is mills capitalize on the tariffs and uncertainty of tariffs, and they’ve been able to raise prices such that at $900 a ton it’s more than what would happen to price with an actual 25% tariff implemented,” Timna Tanners, an analyst at Wolfe Research, said during a telephone interview. “This isn’t the desired outcome Trump has articulated.”
Metal shipments are pouring into the US from all over the world, including cargoes from Egypt, Algeria, Malaysia, Brazil and Vietnam, according to a person familiar with the flows. The influx comes amid relatively anemic US steel demand as high borrowing costs make it expensive for buyers to move ahead with projects in everything from construction to appliance manufacturing.
Trump earlier this month ordered a 25% tariff on steel and aluminum imports, and in the process announced he would rescind all existing country-level exemptions. The specter of a protectionist wall emboldened domestic steelmakers like Nucor Corp., Cleveland-Cliffs Inc., United States Steel Corp. and Steel Dynamics Inc. to raise prices.
As recently as five weeks ago, a ton of steel was selling for less than $700. But by this week, domestic producers were quoting their customers prices as high as $1,000, according to people familiar with the situation — levels not seen since the beginning of 2024. The conundrum is that tariff threats have raised prices even as demand remains unchanged.
Domestic hot-rolled coil, the benchmark steel product, is 23% more expensive than imported supplies, researcher Steel Market Update said this week.
Meanwhile, some Canadian and Mexican steelmakers are telling customers they are refusing new orders. The measures have put Algoma Steel Group Inc.’s order books under “extreme pressure,” said Chief Executive Officer Michael Garcia.