Nucor Corporation and Cleveland-Cliffs, the dominant players in the U.S. steel industry, have implemented contrasting pricing strategies for hot-rolled coil (HRC) steel, reflecting divergent responses to evolving market dynamics. On April 14, 2025, Nucor reduced its HRC base price by $5 to $930 per short ton, marking its first decline after eight consecutive increases since July 2024. Conversely, Cleveland-Cliffs raised its May spot price to $975 per ton, a $75 jump from April levels. These adjustments underscore the complex interplay of raw material volatility, geopolitical policy shifts, and sector-specific demand trends reshaping steel markets. The moves come amid heightened uncertainty following the Trump administration’s sweeping tariffs and softening demand in key industrial sectors, creating ripple effects across distributors, manufacturers, and global supply chains.
Price Adjustment Trajectories: Nucor’s Pullback vs. Cliffs’ Surge
Nucor’s Strategic Price Corrections
Nucor’s pricing strategy has been characterized by aggressive increases followed by tactical retreats, a pattern evident in its Consumer Spot Price (CSP) system. The recent $5 reduction follows a nine-week period where HRC prices surged by $175 per ton, driven by scrap metal inflation and anticipation of Section 232 tariffs. This minor pullback suggests a recalibration to address softening distributor demand and inventory saturation.
Nucor HRC Base Price History (2024–2025)
| Date | HRC Price ($/st) | Change ($) | Cumulative Change |
|---|---|---|---|
| July 29, 2024 | 675 | – | Baseline |
| August 5, 2024 | 690 | +15 | +2.2% |
| August 26, 2024 | 710 | +20 | +5.2% |
| January 21, 2025 | 760 | +50 | +12.6% |
| February 3, 2025 | 775 | +15 | +14.8% |
| February 10, 2025 | 790 | +15 | +17.0% |
| February 17, 2025 | 820 | +30 | +21.5% |
| February 24, 2025 | 860 | +40 | +27.4% |
| March 17, 2025 | 935 | +75 | +38.5% |
| April 14, 2025 | 930 | -5 | +37.8% |
Cleveland-Cliffs’ Aggressive Pricing Momentum
Cleveland-Cliffs has maintained an upward trajectory, leveraging its integrated supply chain and dominance in automotive contracts. The company’s latest $975/ton May price reflects confidence in sustained demand from reshoring initiatives and renewable energy infrastructure projects.
Cleveland-Cliffs HRC Price History (2024–2025)
| Date | HRC Price ($/st) | Change ($) | Cumulative Change |
|---|---|---|---|
| May 1, 2024 | 545 | – | Baseline |
| December 18, 2024 | 800 | +255 | +46.8% |
| February 21, 2025 | 900 | +100 | +65.2% |
| April 11, 2025 | 975 | +75 | +78.9% |
Cliffs Iron Range Layoffs Hit Minnesota
The Iron Range region of Minnesota is facing economic hardship as Cleveland-Cliffs announced temporary layoffs affecting 597 steelworkers at the Hibbing Taconite Company (HibTac) and the Minorca Mine. State officials confirmed the layoffs, which could become permanent by late May, are due to an oversupply of iron ore from 2024. The news has prompted concern from Minnesota politicians, with Republican state Rep. Spencer Igo criticizing state and federal policies, while DFL state Sen. Grant Hauschild expressed solidarity with the affected workers. U.S. Sen. Tina Smith emphasized the broader impact of these job losses on the community and pointed to the Trump administration’s tariffs as a contributing factor to the industry’s instability. The layoffs will impact 255 jobs at HibTac and 342 jobs at Minorca, exacerbating concerns about the region’s economic future.
Key Drivers of Recent Price Adjustments
1. Raw Material Cost Volatility
The steel industry faces mounting pressure from scrap metal prices, which reached $349 per ton in March 2025—a 22% year-over-year increase. For electric-arc furnace (EAF) producers like Nucor, this surge has squeezed margins, necessitating price adjustments to offset costs. Meanwhile, Cleveland-Cliffs, reliant on blast furnace operations, contends with iron ore prices at $128 per ton, exacerbated by supply disruptions in Australia and Brazil.
2. Tariff Policy Uncertainty
The Trump administration’s April 10 announcement of a 90-day pause on reciprocal tariffs created market hesitation, with buyers delaying orders amid fears of retaliatory measures3. This pause contributed to Nucor’s cautious $5 reduction, while Cliffs’ increase signals anticipation of post-pause demand resurgence. The broader Section 232 tariffs, reinstated at 25%, have further complicated import dynamics, making foreign steel less attractive despite domestic supply constraints1.
3. Demand-Supply Imbalances
Automotive sector demand, accounting for 25% of U.S. HRC consumption, remains robust, with annual vehicle production holding steady at 12.8 million units. This stability supports Cliffs’ premium pricing strategy. Conversely, the construction sector has faced headwinds from rising interest rates, slowing commercial projects and reducing rebar demand—a key market for Nucor’s distribution network.
4. Strategic Inventory Management
Distributors reduced HRC inventories to 2.1 months’ supply in March 2025, down from 3.4 months in 2024, creating spot market opportunities for mills. This inventory drawdown reflects cautious procurement strategies amid price volatility, with 63% of distributors reducing order sizes to mitigate financial exposure 1.
Sector-Specific Impacts of Price Adjustments
Steel Mills: Divergent Margins and Strategies
Nucor and Cleveland-Cliffs exhibit contrasting financial profiles shaped by their operational models:
- Nucor’s Q1 2025 revenue reached $9.2 billion, an 18% year-over-year increase, with an operating margin of 14.3%. Its decentralized EAF operations provide flexibility but increase exposure to scrap price fluctuations.
- Cleveland-Cliffs reported Q1 revenue of $5.8 billion, up 27% YoY, with a 19.1% operating margin driven by long-term automotive contracts and vertical integration.
Distributors and Service Centers
Regional disparities have emerged, with Midwest service centers reporting 15% longer lead times due to transportation bottlenecks, while coastal counterparts benefit from import alternatives. Carrying costs have risen to 28% of revenue, forcing distributors to prioritize just-in-time procurement 1.
End-User Industries: Cost Pressures Mount
- Automotive Manufacturers: Rising steel prices have increased vehicle production costs by $240 per unit, accelerating the shift toward aluminum for body panels and closures .
- Construction Firms: Steel-intensive projects face 6-8% budget overruns, delaying 12% of planned infrastructure starts in Q1 2025.
Market Outlook: Navigating Uncertainty
The U.S. HRC market remains bifurcated, with Cliffs prioritizing contract stability and Nucor balancing spot market agility. Key factors influencing future trends include:
- Tariff Policy Resolution: Clarity post-July 2025 could trigger $50–$100 per ton price swings, depending on retaliatory measures from trading partners 3.
- Scrap Market Trends: A 10% decline in scrap prices would restore $40 per ton margins for Nucor, alleviating cost pressures.
- Reshoring Momentum: 43% of manufacturers plan to reshore production by 2026, potentially adding 5 million tons of annual steel demand.
Conclusion
Nucor’s cautious retreat and Cleveland-Cliffs’ bold surge exemplify the strategic divergence defining the U.S. steel industry’s response to 2025’s volatile markets. While raw material costs and policy uncertainty persist, differentiated pricing models allow market leaders to navigate turbulence. Distributors and end-users must adopt hybrid procurement strategies, blending contract commitments with spot purchases to mitigate financial risks. As global trade dynamics evolve, stakeholders across the value chain will need to remain agile, leveraging data-driven insights to thrive in an increasingly complex landscape.
If you enjoyed this article check out some of our other recent articles on the subject:
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- Nippon Steel’s Strategic Pivot in U.S. Steel Acquisition Under Trump Administration
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