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    Overseas

    Foreign vs. Domestic Hot Rolled Price Spread

    Written by Brett Linton


    This should come as no surprise to our readers, the theoretical spread between foreign steel export prices and the SMU hot rolled coil index average is quite large. However, when looking at foreign steel offers on hot rolled (and there are precious few) which range from $820-$840 per ton, according to SMU sources, the spread is quite narrow. What we provide below is our twice monthly “theoretical” calculation based on international prices FOB the exporting country with $90 of costs added. We do not include the 25 percent tariff or any other unusual costs to the calculations we provide.

    The following calculation is used by Steel Market Update to identify the theoretical spread between foreign hot rolled steel import prices (delivered to USA ports) and domestic (USA) hot rolled coil prices (FOB Domestic mills). We want our readers to be aware that this is only a “theoretical” calculation as freight costs, trader margin and other costs can fluctuate, ultimately influencing the true market spread.

    Brett Linton

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