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US Steel Imports Surge, Driven By Price Differentials

Steel imports are expected to hit 3.2 million tons in January, up 23 percent from a year ago, as price differences between U.S. and Chinese steel rose to $159 per ton. At this time last year, U.S. steel cost $19 less than Chinese steel, according to market analysis firm CRU Group.

“It’s the largest first-quarter import order I’ve seen in the last five years,” one unnamed steel trader told the Wall Street Journal. That trader brokers steel purchases between U.S. buyers and foreign sellers.

The surge in imports could impact confidence in major U.S. steel producers like United States Steel Corp. (NYSE:X), AK Steel Holding Corp. (NYSE:AKS) and ArcelorMittal USA Inc., which all report earnings within the next two weeks.

Price-wise, the average U.S. price for a benchmark hot-rolled coil is $676, up 10 percent from a year ago. That compares with the Chinese benchmark price of $540 a ton. Even with shipping costs factored in, foreign steel can end up being 10 percent cheaper, according to Midland Steel Warehouse Corp.’s Howard Allen.

Asian crude steel production rose marginally in September

  1. A Baosteel mill in Shanghai last year. Chinese officials are trying to get mills to cut back on steel exports, which has led to trade disputes. Agence France-Presse/Getty Images. BEIJING—China's exports of steel products rose to a fresh record last
  2. The total crude steel production by China during September was 67.540 Million tonnes, remaining flat when compared with the production during September 2013. India produced 6.846 Million tonnes of crude steel, up 2.5% when compared to 6.677 Million 
  3. Hanging from each of two booms that extend from the front of the boat is a spider array of six stainless steel cables about 4 feet long. In the dark, they look a bit like pale jellyfish. The boat completes the electrical circuit. The array stuns fish

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