Final Thoughts

Section 232

Laura Miller has a good article on what the new Section 232 tariffs will look like when they are rolled out tomorrow. How different are they from what’s been in place? I highly recommend you read the story. But my initial gloss is that it’s like when you try to substitute sourdough for wheat on your sandwich, and the waiter screams back: No substitutions! Also, a side of foreign aluminum is gonna get a lot more expensive.

Neighborly dispute

Of all the “shores” introduced in the world of post-Covid supply-chain woes, “friendshoring” looks like the most tenuous at the moment. While Mexico is in no way off the hook, the Trump administration currently has Canada in its crosshairs (see Stephanie Ritenbaugh’s story here.) 1, 2, 3, 4… I declare a trade war.

It’s a game of high-stakes poker, with the cost of recession for industrialized economies in play. The province of Ontario is mulling slapping a 25% surcharge on electricity sent to the US. And Trump could respond by doubling the duties on Canadian steel and aluminum imports to 50%. As of this writing, Ontario Premier Doug Ford has backed off, as has the White House, for the moment. These days, you have to keep glancing at your smartphone every minute to keep up.

With so many developments happening at breakneck speed, I think I might’ve discerned the true meaning of 4-D chess: Be sure your opponent has no idea where the board even is. Half seriously, with the rules changing so fast, is this trade policy being written by AI?

And let’s not even talk about the stock market. We’ll just say it’s been a shaky couple of days. Then again, when you play poker, you have to have a steely resolve.

Pricing

Speaking of steel, how is pricing looking this week? Hot-rolled coil is continuing its upward climb. We have HR’s high hitting the $1,000 mark. How much higher can it go? Check out Brett Linton’s pricing article here.

Right now, Senior Analyst David Schollaert and Editor-in-Chief Michael Cowden are down in Charleston, S.C., for our Steel 101 workshop. Today, they took a tour of Nucor Berkeley along with all the participants. (Thanks, Nucor!) They were all wowed by the flaming sight of molten scrap being charged into the EAF.

As exciting as that was, it might be that the real fireworks are occurring outside the mill up in Washington, D.C., with the fuse being lit on TruthSocial.

Stay tuned to SMU for the latest on what it all means for steel. Thanks for reading!