Overseas
February 4, 2021
Foreign vs. Domestic HRC Price Analysis: Foreign Advantage Continues
Written by Brett Linton
Foreign steel continues to grow cheaper compared to steel made in the U.S., according to Steel Market Update’s latest foreign vs. domestic hot rolled steel price comparison, tempting buyers to consider purchasing imported steel. With U.S. HRC prices now at $1,150 per ton or higher, foreign HRC prices are theoretically $83-$323 per ton cheaper than domestic steel prices. Recall that domestic mills held record-high price advantages back in August 2020, when foreign steel prices were between $176 and $220 per ton more expensive than domestic steel. This domestic advantage quickly faded in November/December as U.S. prices skyrocketed.
The following calculation is used by Steel Market Update to identify the theoretical spread between foreign hot rolled steel prices (delivered to U.S. ports) and domestic hot rolled coil prices (FOB domestic mills). This is only a “theoretical” calculation as freight costs, trader margin and other costs can fluctuate, ultimately influencing the true market spread. This compares the SMU U.S. hot rolled weekly index to CRU hot rolled weekly indices for Germany, Italy and Far East Asian ports.
