International Steel Prices

Foreign vs. Domestic HRC Price Spread Widens

Written by Brett Linton

The following is a “hypothetical” calculation of the spread between world hot rolled export prices and domestic (USA & Canada) hot rolled prices. Actual HRC price spreads can vary based on freight costs, trader margins and other factors. SMU compares the world export price with adders for freight, handling, trader margin, etc., against the spot (FOB Mill) domestic hot rolled price using the SMU Hot Rolled Index for this week.

The world export price for hot rolled bands is at $484 per net ton ($534 per metric ton) according to data released by SteelBenchmarker earlier this week. This is is $19 per ton lower compared to two weeks ago and $16 per ton lower than mid-August.

With an estimated $70 per ton added in order to get the steel to ports in the United States (freight, handling, and trader margin), the additional costs put the true world export price at approximately $554 per ton CIF USA Port.

The latest Steel Market Update hot rolled price average is $660 per ton, down $5 per ton from two weeks ago and down $15 per ton from mid-August. The theoretical spread between the world export price and the SMU US HRC price is $106 per ton ($176 prior to import costs), up $14 per ton from two weeks ago and up $1 from mid-August. This is the highest price spread since mid-May 2014 when it was $114 per ton ($184 per ton prior to import costs).

The $106 spread represents a significant change from mid-March 2014 when we had a spread of $45 per ton ($115 prior to import costs). One year ago the spread was $52 per ton ($122 prior to import costs).

Below is an interactive graph which you can use to compare world export prices against the SMU domestic HRC average price. We also have included a comparison with freight and traders’ costs added which gives you a better indication of the true price spread (assuming the U.S. offers are not being bumped up by the foreign producing mills or trading companies). You will need to read this article on our website in order to see and interact with the graphic. If you need assistance with either logging in or navigating the website, please contact our office at 800-432-3475 or

{amchart id=”130″ Domestic vs. Foreign Hot Rolled Pricing- Steel Benchmarker World China Europe}

Brett Linton

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