Cleveland-Cliffs has announced a $900 per short ton (st) price for April spot hot-rolled coil (HRC) orders, marking the highest steel price in the U.S. market and surpassing recent increases by competitors U.S. Steel ($850/st) and Nucor ($820/st). This $100/st jump from March 2025 levels reflects tightening supply conditions, policy shifts, and robust demand from automotive and construction sectors.
Cleveland-Cliffs Takes the Lead with $900/ton HRC Price
Cleveland-Cliffs has made a bold statement by setting its April HRC price at $900 per short ton (st), positioning itself at the forefront of the market. This aggressive pricing strategy represents a substantial increase from previous levels and sets a new benchmark for the industry.
Key points of Cleveland-Cliffs’ pricing strategy:
- Closed March contract booking window on February 19th, 2025
- Opening April contract book on February 24th, 2025
- Spot HR book for April to open on February 26th, 2025
- New price of $900/st for April HRC orders
Cleveland-Cliffs CEO Lourenco Goncalves stated, “Our pricing reflects not just today’s market, but the structural shifts defining tomorrow’s steel industry.” This statement underscores the company’s confidence in the sustainability of higher price levels and its strategic positioning in the market.
This represents a 12.5% increase from its December 2024 price of $800/st and a 65.2% surge from its May 2024 base price of $545/st.
Nucor Responds with Strategic Price Adjustments
Not to be outdone, Nucor has implemented its own series of price increases, with the latest adjustment bringing the HRC base price to $860/st for most facilities, effective February 24th, 2025. This marks Nucor’s fourth price increase in 2025, demonstrating the company’s responsive approach to market dynamics.
Nucor’s 2024–2025 Price Trajectory
| Date | HRC Base Price | Increase | Cumulative Change (vs. July 2024) |
|---|---|---|---|
| July 29, 2024 | $675/st | – | Baseline |
| August 5, 2024 | $690/st | +$15 | +2.2% |
| August 26, 2024 | $710/st | +$20 | +5.2% |
| January 21, 2025 | $760/st | +$50 | +12.6% |
| February 3, 2025 | $775/st | +$15 | +14.8% |
| February 10, 2025 | $790/st | +$15 | +17.0% |
| February 17, 2025 | $820/st | +$30 | +21.5% |
| February 24, 2025 | $860/st | +$40 | +27.4% |
Additionally, Nucor’s California Steel Industries (CSI) division will price HRC at $920/st, maintaining a $60/st regional premium to offset higher West Coast logistics costs.
Nucor has also announced a $160/ton price increase on their plate pricing as well.
Cleveland-Cliffs’ pricing strategy has been more aggressive than competitors, with cumulative increases of $355/st since May 2024.
Comparative Analysis: Cleveland-Cliffs vs. Nucor
Both companies have taken aggressive stances on pricing, but with slightly different approaches:
- Pricing Strategy:
- Cleveland-Cliffs has opted for a single, significant jump to $900/st.
- Nucor has implemented a series of incremental increases, culminating in $860/st.
- Regional Variations:
- Cleveland-Cliffs maintains a uniform national price.
- Nucor differentiates pricing for its West Coast operations through CSI.
- Timing:
- Cleveland-Cliffs’ price is set for April contracts.
- Nucor’s price is effective immediately as of February 24th.
Strategic Implications for Cleveland-Cliffs and Nucor
Cleveland-Cliffs
- Vertical Integration Advantage:
- Ownership of 4 scrap processing centers mitigates cost volatility
- 2 billion tons of iron ore reserves in Minnesota ensure raw material security
- Labor Cost Management:
- 2022 USW contract with 20% wage increases over four years, offset by productivity gains
- Green Steel Initiatives:
- $4 billion investment in emissions reduction technologies and EAF upgrades
- Potential for premium pricing on “green steel” products ($15-30/st surcharges)
Nucor
- EAF Efficiency:
- 70% of U.S. steel production through electric arc furnaces, offering flexibility in production
- Scrap Self-Sufficiency:
- 15 scrap processing centers supplying 70% of raw material needs
- Regional Pricing Strategy:
- Differentiated pricing for West Coast operations through CSI
Market Drivers Behind the Increases
Several key factors are contributing to these price hikes:
- Section 232 Tariff Reinstatements:
The reintroduction of 25% tariffs on steel imports is expected to reduce import competition and strengthen domestic producers’ pricing power. This policy shift has created a more favorable environment for U.S. steel producers to raise prices. - Strong Demand from Key Sectors:
- Automotive: The January 2025 SAAR (Seasonally Adjusted Annual Rate) reached 16.2 million vehicles, up 14% year-over-year.
- Construction: Infrastructure Bill-driven demand has increased steel consumption by 19% since August 2024.
- Raw Material Costs:
Ferrous scrap prices have risen 38% year-over-year due to tariffs on Canadian scrap, increased energy costs, and global demand pressures. - Supply Chain Constraints:
Order lead times have extended to 10-12 weeks, reducing spot market availability and creating a tighter supply environment. - Market Testing:
These increases may be seen as attempts by both companies to test the market’s readiness for higher price levels, gauging customer reactions and competitor responses.
Downstream Industry Impacts
Industry Impact and Outlook
The price increases by Cleveland-Cliffs and Nucor are likely to have significant ripple effects across the steel industry and downstream sectors:
Automotive Manufacturing
- Estimated cost increase per vehicle: $6,250 to $7,200
- Potential retail price increases of 5-6%
- Possible delays in EV model launches by 6-12 months due to increased costs for battery casings and chassis components
Construction Projects
- Residential housing material costs up $5,000-$10,000 per home
- Commercial projects facing 19% increases in structural steel expenses since August 2024
- 14% of infrastructure contractors reporting bid postponements due to steel price uncertainty
Consumer Goods
- Appliance manufacturers like Whirlpool announcing 8-10% price increases for Q2 2025
- Industrial equipment makers projecting 5-7% price hikes on steel-intensive machinery
Consumer Goods Breakdown
| Product | Estimated Price Increase |
|---|---|
| Refrigerators | 8–10% |
| Washers/Dryers | 10–12% |
| Industrial Equipment | 4–7% |
Source: Peterson Institute for International Economics 1.
Future Outlook: Steel Prices in 2025
Price Projections
| Scenario | Q2 2025 HRC Price | Conditions |
|---|---|---|
| Base Case | $950/st | Current demand persists |
| Bull Case | $1,050/st | Auto SAAR >16.5M, tariffs maintained |
| Bear Case | $900/st | Tariff exemptions renegotiated |
Analysis based on Cleveland-Cliffs’ order book trends.
Policy Risks and Market Uncertainties
Several factors could influence the sustainability of these price increases:
- WTO Challenges: Potential rulings against Section 232 tariffs could alter the competitive landscape.
- 2024 Election Impacts: Changes in administration could lead to shifts in trade policies, potentially affecting steel prices by 15-20%.
- Global Economic Conditions: Any slowdown in key sectors like automotive or construction could dampen demand and pressure prices.
- Raw Material Volatility: Fluctuations in scrap prices or energy costs could squeeze margins if not fully passed on to customers.
Conclusion: Navigating the New Steel Price Paradigm
The price increases announced by Cleveland-Cliffs and Nucor represent a significant shift in the U.S. steel market. These moves reflect confidence in sustained demand, favorable policy environments, and the ability to pass on increased costs to end-users.
For downstream industries, these price hikes necessitate strategic responses:
- Inventory Hedging: Locking in prices via forward contracts
- Design Optimization: Reducing steel use in products or exploring alternative materials
- Supplier Diversification: Considering a mix of domestic and international sources, where possible
- Inventory Management: Use of ERP systems to monitor and control inventory levels
As the market adjusts to these new price levels, the sustainability of these increases will depend on the interplay of demand strength, policy continuity, and overall economic conditions. Both Cleveland-Cliffs and Nucor have positioned themselves as price leaders, betting on their operational efficiencies and market insights to navigate the evolving landscape of steel production and consumption in the United States.
The coming months will be crucial in determining whether these price levels represent a new normal for the industry or if market forces will necessitate further adjustments. Stakeholders across the steel value chain will need to remain vigilant and adaptable in this dynamic environment. To stay up to date with the latest steel pricing be sure to subscribe to the Steel industry Email Newsletter below for free!
If you enjoyed this article check out some of our other recent articles on the subject:
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