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U.S. steelmakers are slashing prices to cope with a flood of imports juiced by the strong dollar, a move that will pressure their profit margins and reduce costs for buyers of steel, WSJ reports.
- Imports rose 33% Y/Y in January, according to new figures from the American Iron and Steel Institute, reaching 3.85M tons vs. 2.9M a year earlier; to stem the tide, steelmakers with major U.S. operations such as ArcelorMittal (NYSE:MT), U.S. Steel (NYSE:X) and Nucor (NYSE:NUE) have cut prices in recent weeks, according to steel distributors who buy from them.
- The benchmark hot-rolled coil index is down 17% YTD to ~$500/ton, its lowest level since August 2009.
- The lower steel prices are good news for makers of cars and car parts, construction companies and other major buyers of steel (NYSEARCA:SLX).