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The toll of tariff changes has been felt disproportionately by steel distributors, processors, original equipment manufacturers and end users. But producers are also hurting as demand has dipped in the short term, market sources said.
In this environment, less-than-robust steel plants are being idled. And that is not surprising to market participants.
In his second term, US President Donald Trump is looking to reorder the global economic order. But in doing that, his administration is “moving too fast, and breaking things,” a steel processor said.
“As a processor we look for optionality, but that is hard to do when the ground beneath you shifts everyday,” the processor said.
Trump implemented a 25% tariff on steel in March and doubled the tariffs to 50% in June, under Section 232.
President Trump is leaning hard on rebuilding domestic manufacturing and heavy industries. But steel producers are just one part of the supply chain, the processor noted, giving the example of the domestic plate industry. This was heavily reliant on importing slab substrate to meet its needs, a bulk of which came from Brazil.
“Trump has clear priorities of building the defense and energy sectors, and shipbuilding is a priority for this administration – but all shipbuilding requires finished steel plate, and there just isn’t enough finished steel plate capacity in the US,” the processor said.
The processor highlighted the “structural undersupply of slab in the US.”
“The undersupply of slab is about 5 million tons; and the reality is that slabs are going to have to come from somewhere,” the processor said.
Brazil exported 942,793 tonnes of steel slab in June. And the US received 752,503 tonnes of that total, maintaining its position as Brazil’s main steel buyer despite the recent 50% tariff on steel and aluminium imports.
On August 1, steel slab prices exported from Brazil was $465-480 per tonne, up by 0.53% from $465-475 per tonne the week before.
With a 50% tariff being applied to steel imports, buying material from overseas has become impossible, the processor said. And domestic demand is also unseasonably slow.
“This is a demand story,” a steel distributor said. They emphasized that if not for the tariffs, domestic producers would be hurting.
The distributor said they was not surprised to see Cleveland-Cliffs idling three plants, as “it is a down environment.”
Cleveland-Cliffs indefinitely idled its Steelton and Conshohocken facilities in Pennsylvania, and the Riverdale facility in Illinois, on June 30.
A company spokesperson had told Fastmarkets in May that the idling of these facilities was due to poor demand for its products. These include rail, specialty plate and high-carbon sheet. And fall outside Cleveland-Cliffs’ core business focus on flat-rolled steel, which remain unaffected, the spokesperson said.
The Cleveland-headquartered steelmaker listed its Conshohocken plate finishing facility for sale two weeks after indicating it could reopen if conditions warranted.
Cleveland-Cliffs acquired the Conshohocken plant from ArcelorMittal in 2020. And the facility processed coiled and discrete plate, including military and commercial alloys and heat-treated carbon products.The closure of the Conshohocken facility “did not take out any plate manufacturing capacity from the US market as it was just a finishing facility,” the processor said.
Spot plate demand remains muted, the processor said. And some domestic producers are negotiating aggressively with customers to offer deals way below the listed offer prices.
Plate prices in the US declined for the second week in a row on Tuesday August 5. And sources reported sluggish spot trading.
Fastmarkets’ weekly assessment for steel cut-to-length plate carbon grade, fob mill US was $53 per hundredweight ($1,060 per short ton) on August 5, down by 1.85% from $54 per cwt on July 29.
The Steelton facility produced railroad rails and flat bars. And was one of three domestic rail-producing mills, alongside Evraz in Pueblo, Colorado and Steel Dynamics Inc in Columbia City, Indiana.
The Steelton mill had old equipment and was inefficient, the steel processor said.
“Steelton is only rails, and the equipment at Steelton is really old, it was super inefficient; I was not surprised that was idled as well,” the processor said.
On the other hand, the Riverdale facility was a compact strip mill producing hot-rolled sheet, including high-carbon and alloy black bands.
The steel distributor said that the steel produced at Riverdale was “niche, high carbon products, products that no one else makes.”
“Low volume, hard to make products in a down environment, I can see why they idled Riverdale,” the distributor said, adding that “Riverdale’s customers are having to source their metal from overseas, despite the tariffs.”
A second steel distributor told Fastmarkets that “from Cleveland-Cliffs’ last earnings call, it was clear they needed money, so they are looking to divest those assets.”
Cleveland Cliffs’ chief executive officer Lourenco Goncalves had said that some idled assets could be sold during the company’s second quarter earnings call on July 21.
Cleveland Cliffs had posted a $470 million loss during the second quarter of 2025. And during the earnings call, Goncalves had alluded that the integrated company itself is a valuable and marketable asset.
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