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LocateQ3 Update on Pricing, Tariffs and Lead Times
I want to clarify why your steel pail prices are increasing in the third quarter.
Back in February, when President Trump announced an increase in steel tariffs, there was a surge in demand for domestic steel. When demand surges, steel prices rapidly increase, as seen in February and March (see the graph below).
What is very important to understand is that CSC purchases the majority of our steel on annual contracts. Annual contracts give you volume commitments but are subject to quarterly price adjustments. The price adjustment for Q3 is based on the change in the average price for cold-rolled steel from Q1 to Q2, minus a 30-day lag.
Steel prices increased by 25.6% during this period. Therefore, the rapid escalation in steel prices that occurred in February and March is now affecting steel pail prices, starting in July by 11.75%.
Good News! According to Steel Market Update, CR coil prices have declined modestly in recent weeks, easing to an average of $1,035 per short ton as of May 15. This is down $5 per short ton from the prior week and $60 lower than mid-April. This marks a pause in the previous strong downward trend, but prices are still significantly above Q1 2025 levels.
We’ll keep tracking the market closely and will update you again if conditions shift.
Steel Tariffs: Expanded to 50%
On May 31, President Trump announced plans to double Section 232 tariffs on imported steel and aluminum—from 25% to 50%—effective June 4. The announcement, made at a U.S. Steel rally in Pennsylvania, is part of his push to boost domestic steel production and follows news of a planned $14 billion investment by Nippon Steel in U.S. Steel operations.
While industry groups like the AISI praised the move, others, including domestic manufacturers and the Can Manufacturers Institute, warned that the higher tariffs could raise input costs and drive up consumer prices. Analysts expect the increase to put further upward pressure on U.S. steel prices and lead times. Despite the domestic focus, critics in Canada and among U.S. unions expressed concern over the policy’s long-term impact and lack of transparency.
More Good News! Lead Times Have Stayed Down
We’re continuing to make steady progress on reducing and stabilizing our plant lead times. Most orders are now shipping in five weeks or less, and we’re staying on track with our 4–6 week target. While we continue to monitor incoming order volume closely, our capacity improvements are holding, and we’re in a stronger position to respond quickly to customer needs than we have been in the past.
For Further Reading:
- Cold Rolled Steel Pricing: https://www.steelmarketupdate.com/2025/05/27/smu-price-ranges-markets-quiet-following-memorial-day/
- Section 232 Tariff Updates: https://www.steelmarketupdate.com/2025/05/30/breaking-news-trump-says-s323-tariff-on-steel-ali-to-double-to-50-at-pennsylvania-rally-celebrating-nippon-uss-deal/
- Market Impact of US Steel Tariffs: Trump Tariffs: The Economic Impact of the Trump Trade War
Thank you for your continued support, and we’ll be in touch with more details as they become available.
If you have any questions about an upcoming pail order, don’t hesitate to contact your sales manager!
Kindly,
Dan Roether
Vice President of Sales
Jeff Swan
Hey there! My name's Jeff Swan and I'm the Sales and Marketing Specialist at Cleveland Steel Container.
