Section 232 Tariffs at 50% Keep Import Supply Contained as US HRC Market Tightens

The Section 232 tariff on steel imports remains at 50%, doubled from 25% in June 2025 under Proclamation 10896. The recent Supreme Court ruling in V.O.S. Selections v. United States struck down certain IEEPA-based tariffs but explicitly left Section 232 untouched. The 50% rate applies to all steel imports including HRC.

The impact on trade flows is unambiguous. Total US flat-rolled imports fell 42% year-over-year in 2025, the most recent full-year data available. EU steel exports to the US dropped 34% since the tariff doubling, according to industry body Eurofer. Argus Media reports that HRC imports that do arrive must often absorb part of the 50% duty to remain competitive.

OECD data shows US hot rolled coil prices are more than double Chinese prices and roughly 50% above EU prices. This gap reflects the effectiveness of the tariff regime and the tight domestic supply situation. Without tariffs and quotas, imports would surge to capture the spread.

US mills are using the protected environment to push margins. Nucor's weekly HRC increases have run uninterrupted since January. Steel Dynamics reported Q1 steel operations average selling prices at $1,193/ton, with spreads over scrap costs widening. The accelerated announcements of domestic manufacturing investments and onshoring are expected to support steel demand structurally.

The EU is preparing its own higher steel tariffs. The European Commission proposed replacing expiring safeguards with lower quotas and higher above-quota tariffs (25% to 50%) on flat-rolled products, plus stricter melt-and-pour origin rules. This would further regionalize steel trade and limit diversion risk into North America.