US hot-rolled coil prices moved up further Friday as market participants were weighing the potential effects of US President Donald Trump's newly signed steel tariffs.
The daily Platts TSI US HRC assessment was calculated at $849.50/st Friday, up $5/st from Thursday. The daily Platts TSI US CRC assessment was calculated at $953.50/st Friday, unchanged on day.
Trump on Thursday signed off on a 25% tariff on steel imports to the US to take effect March 23. Currently only imports from Mexico and Canada will be exempt, however, there is the potential for other country or product exclusions. Multiple service center sources said they were not seeing HRC offers from domestic mills below $850/st by the end of the week. Leading up to Thursday's tariff announcement, a number of buyers reported difficulty getting spot pricing information from domestic mills given rapid market changes stemming from the uncertainty surrounding the US' new tariffs on steel imports.
An integrated producer said they have continued to offer in the spot market this week, with HRC transacting at $850/st. Cold-rolled coil and hot-dipped galvanized prices are moving up fast, he said, adding that base prices are currently transacting close to $1,000/st.
"Order book is quite busy and customer demand [is] very robust," he said. "I sense from customer discussions that almost every mill right now is in May for lead times."
A service center source was offered 500 st at $850/st from one mill and was unable to negotiate with the mill to increase the size of the order, he said.
"Either they are selling out quickly, or they are going to bump the price up," he said.
Importers are still working to get their heads around the White House's tariff plan, a US-based trader said. He said he had some material still on its way to the US, but expected customers would be willing to pay the 25% tariff given the tight availability and rising prices in the US HRC market. "In the short-term it's going to be tough," he said. "Nobody is going to be booking until there's more clarity on the exemption process and what may change."
Looking a few months down the road, however, it could be back to business as usual if US domestic pricing continues to climb, he said. With talk in the market that US HRC could reach $1,000/st or more and the likelihood that global prices will be pressured by the redirection of imports not coming into the US, it could leave the door open to favorable import margins for traders, even with the 25% tariff, he said.
"Imports will be coming in at the same level," he said. "Or domestic mill prices have to get to a lower level that would make it so that imports are not competitive."
The combined Platts TSI price index uses a volume-weighted average calculation -- according to TSI's standard -- to determine value on an ex-works Indiana basis.
