Tariff and mill price rises stun US stainless buyers

The unexpected doubling of the United States’ steel and aluminium import tariffs, followed by a significant price rise announcement from the country’s largest stainless steel producer, further unsettled the US market in June.

The US government’s decision to double its steel and aluminium import tariffs to 50% on June 3, which took effect immediately, caught many buyers off guard. The increase applies to all countries except the United Kingdom, which retained its 25% rate until July 9, after which the rate could be adjusted.  

Some buyers, who had shipments en route to the US, were forced to renegotiate prices, with no exemptions or appeals process available. Others rushed to cancel orders with their overseas suppliers. Several respondents told MEPS that the doubling of Section 232 import tariffs has made importing “virtually impossible”.   

• This article first appeared in the June edition of MEPS International's Stainless Steel Review. The publication features market insight, stainless steel prices, indices and forecasts from key markets in Europe, Asia and North America. Visit mepsinternational.com or contact MEPS for details of how to subscribe.

Market participants reported a wave of bankruptcy filings, particularly among foreign-owned automotive parts manufacturers and metal distributors with US operations, citing increased financial strain caused by the intensifying trade restrictions.   

Domestic mill bookings remain at a low level, despite expectations that increased tariffs will tighten supply. Delivery lead times are short for most standard size commodity grade coils, at four to five weeks. Buyers can afford to wait before making purchasing decisions. Inventories are adequate, and material can be sourced from stock at competitive prices. However, the growing uncertainty around US trade relations continues to dampen confidence and purchasing activity.    

Shock price increase announced by NAS  

On June 13, North American Stainless (NAS), the country’s largest stainless steel producer, surprised buyers with the announcement of price rises applicable to shipments from July 1, 2025. All new and outstanding quotations are subject to the changes, it said. The rises cover a wide range of hot and cold rolled flat and long products and grades, and include adjustments to some extras.   

The functional discount for grade 304 cold rolled coils and sheets has been reduced by eight percentage points. Grade 316 and most other austenitic grades, along with grade 430 cold rolled coil and sheets, have had their functional discount reduced by nine percentage points. These announced discount cuts equate to base price rises of USD310 per tonne on grade 304 material, USD464 per tonne on grade 316 and USD242 per tonne on grade 430.  

The announcement increases its grade 304 hot rolled coils and sheet prices by USD298 per tonne and grade 316 by USD441 per tonne. Its grade 304 hot rolled plate prices have risen by USD397 per tonne and grade 316 by USD551 per tonne as a result of the changes.   

MEPS respondents were surprised by the scale of NAS’s price rises, which were its first since February 2022. US mills had previously cited oversupply and weak demand as reasons for holding back from price increases. Almost two weeks after the NAS announcement, Outokumpu, the second largest US stainless producer, also announced price increases. These broadly mirror those of NAS, but are slightly less on key commodity grades, including 304 and 316 cold rolled coil and sheets.   

Some buyers question the effect that mill price increases will have, noting that a large proportion of NAS’s business is under fixed-price contracts. Outokumpu is more exposed to the spot market.   

Many MEPS respondents say that the US market’s current demand levels may not support higher prices, raising doubts about their sustainability, especially if the steel import tariffs are removed or reduced in the coming months. Furthermore, many buyers said that they would be unable to pass on such a rise to their customers, forcing them to make smaller, incremental rises.