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“There is so little spot [market material] available,” a distributor recently told Fastmarkets, while a trader questioned whether the market could face a major flat rolled steel shortage in the coming months.
Whether buyers’ inability to secure spot tonnages was linked to the sharp year on year decline in HRC import volumes has become a growing point of discussion.
According to census data from the US Department of Commerce, the US imported 502,780 metric tonnes of HRC between January 1 and April 1, 2025. That figure fell to 215,027 tonnes over the corresponding reporting period in 2026. The 2026 total also included license data, which is typically higher than final census counts.
Other factors affecting current market dynamics included mills’ spring maintenance outages, which have been further compounded by multiple mills temporarily pulling out of the spot market. At the time of publication, at least three mills were not currently selling HRC on spot terms.
Others were reported to be “significantly behind” on deliveries.
With spring maintenance outages continuing and autumn outages ahead, some market participants have begun to question whether supply constraints could force buyers – by necessity rather than price – to turn back to imports to meet inventory needs and order commitments.
Fastmarkets contacted US steelmakers Cleveland Cliffs, Nucor, Steel Dynamics (SDI), JSW Steel (JSW), North Star BlueScope (NSBS), NLMK and US Steel to ask whether operational adjustments were being made or considered to ensure that customer needs would continue to be met amid reduced import inflows and longer domestic lead times.
Neither Cleveland-Cliffs, Nucor, JSW, SDI, nor NSBS had responded by the time of publication, while a spokesperson for NLMK declined to comment.
Amanda Malkowski, US Steel’s director of media relations told Fastmarkets on May 1 that the company had restarted the blast furnace and steel shop at its Granite City Works in late-March, noting that because of this restart, US Steel has “the ability to sell more to meet customer demand.”
And while a mill source recently told Fastmarkets that his employer planned to increase production rates following its spring maintenance outage, he did not respond when asked for more specific details on the extent of that increase.
Despite buyers’ continuing complaints about HRC spot availability, domestic mills continued to back the decision by the administration of US President Donald Trump to raise the Section 232 tariff on imported steel to 50% from 25% in June of last year. This was move that Cleveland Cliffs chief executive Lourenco Goncalves said “has driven steel imports into the US to their lowest levels since 2009.”
During the company’s second-quarter earnings call on April 20, Goncalves said that strength in the domestic steel market was being driven by developments on the trade front.
“The Trump administration has given the domestic steel industry what we needed and have been asking for,” he added. “Domestic supply chains are more resilient.”
Not everyone agrees, however.
“[The market is] not resilient enough to be undersupplied,” a Midwest market participant said, adding that, with more orders and less steel available, the supply deficit will continue. “That’s where we are. There can be no [remedy] unless the [supply] deficit narrows – and the deficit is still building.”
Numerous sources told Fastmarkets that they expected current supply and demand conditions to persist through at least the third quarter, defying historical seasonal patterns. The continuing lag in availability has driven HRC prices to multi year highs in recent weeks.
“I think there were a lot of people who thought prices would settle in the summer months, and that is not happening,” another buyer said. Others reported that lead times were a case of “you get it when you get it,” with extended – and in some cases uncertain – delivery windows expected to continue.
“Limited spot tons, limited imports, spring outages and some [production issues at a couple of mills] in late 2025 have kept supply tight and pricing elevated,” a source based in the US Southeast said.
During Cleveland Cliffs’ second-quarter earnings call, chief financial officer Celso Goncalves said that 12% of the company’s US shipments during the quarter were sold on the spot market.
Other domestic flat-rolled steel mills have been less transparent.
Fastmarkets contacted Nucor, NLMK and NSBS to ask what percentage of their domestic output was sold into the spot market, but none had responded by the time of publication. A spokesperson for JSW said that the company does not disclose how its sales are structured between spot and contract volumes. US Steel’s Malkowski told Fastmarkets on May 1 that “all of the new melt at Granite City has unlocked spot market sales for us.”
Fastmarkets then contacted the Steel Manufacturers Association and the American Iron and Steel Institute to ask whether they collected aggregate data on this breakdown. Both organizations said they do not track that information.
Regardless of the exact tonnages mills were allocating to the spot market, buyers said that availability remained the core issue.
“If you put a gun to my head and told me I needed to go out and buy 5,000 tons [of HRC] on the spot market, I cannot do it – I’d be dead,” a Midwest market participant told Fastmarkets. “I cannot even go out and offer to pay $40-50 [per cwt] above the spot market index for that volume – [even at that price] I still could not get it.”
Trade attorney Tung Nguyen said that given the domestic steel industry’s strong support of the 50% Section 232 tariff rate – even though the US Congress could theoretically limit or eliminate the tariffs through legislation – he believed that any such move would face significant opposition from domestic steelmakers.
“With strong support from the domestic steel industry, I do not expect a meaningful policy reversal in the near term,” he told Fastmarkets, adding that if the domestic supply chain cannot meet demand, prices will need to rise to a level that would justify imports – despite the duties. “For buyers who cannot source HRC domestically, paying the tariff may be the only viable option.”
Fastmarkets also contacted four members of the Congressional steel caucus, including caucus Chair Congressman Rick Crawford, to ask whether policymakers should evaluate whether current trade measures were supporting the needs of both domestic steelmakers and the market’s supply needs.
No responses were received by the time of publication.
In the absence of near-term policy relief, market realities were taking precedence.
Tiffany Smith, the National Foreign Trade Council’s vice president of global trade policy, said that while companies shared the administration’s goal of increasing US manufacturing, limits on domestic availability were increasingly creating practical constraints.
“In many cases, finding the… inputs they need domestically is just not possible,” Smith said. “In these instances, the choice is not whether to import; it’s simply a question of from where, and at what cost.”
That pricing dynamic was already beginning to shape market behavior.
Another market source told Fastmarkets that, if HRC spot availability remained tight, imports would be needed to fill the gap.
“If [the domestic mills] cannot supply it, imports will [need to] come in. When there is an unavailability of tons, the gap between the domestic price and import price shrinks,” they said.
“When you have tariffs on [imported] steel at 50%, what [people] do not talk about, ever, is the imaginary domestic tariff that is immediately put in place,” they added. “With this situation, let’s not kid ourselves: [the domestic mills] will keep cranking prices up to [a point] where they let imports in.”
Fastmarkets’ North America senior steel analyst, Felix Bello, said that while the market was tight now, that tightness was unlikely to persist over the long term, particularly with new electric-arc furnaces scheduled to come online in the US in the coming years.
For example, Nucor’s new sheet mill in Mason County, in the state of West Virginia, will likely begin shipments in early 2027, adding 3 million tons per year of sheet capacity to the US market. US Steel’s Big River 2 EAF in Osceola, Arkansas, was projected to reach full capacity of 3 million tpy by the end of 2026. Additionally, the Hyundai-POSCO mill being built in Ascension Parish, Louisiana, was expected to produce 2.7 million tpy of steel, and was scheduled to come online in 2029.
Even with new mills expected to expand US steel capacity in the coming years, current strength in downstream demand – particularly from emerging verticals such as data centers – may not be permanent, which could lead to overcapacity in the domestic market.
As an example, during its second-quarter earnings call on April 16, Insteel Industries chief executive officer HO Woltz III said that he expected the market to have “five solid years of data center activity.”
Demand from hyperscalers beyond the current data center buildout was uncertain.
Despite longer-term capacity relief being on the horizon, it does little to address buyers’ immediate challenges. Bello said that the only short term remedy available to buyers was to import.
“Mills have absolute pricing power and absolute supply power,” Bello said, adding that while additional capacity was coming, mills’ control of existing supply “has us where we are now because they are supported by the tariffs.”
Bello also noted that the durability of Section 232 measures remained uncertain, particularly if the opposition Democratic Party were to regain political control of the House of Representatives and the US Senate in the midterm elections in November this year.
“[The tariffs] are not going away in the short term unless the midterms go badly for the [Trump-led Republican Party] administration,” he said. “There are a lot of constituents in a lot of states that are against them being this high, and there have already been pockets of complaints.”
That uncertainty, Bello said, may be reinforcing current pricing behavior.
“The fear on the seller side is the collapse of the tariffs,” he said. “What if they disappear after the midterms? This market is an opportunity for mills to lock-in buyers while the tariffs are still in place. They have the tiger by the tail – but we’re only months away from that tiger potentially slipping away.”
Robert England in the US contributed to this article.(This report has been updated to include new information in the 10th and 22nd paragraphs.)
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