The question in the steel market right now is what will finally loosen supply. At this point, we are not seeing much near-term relief.
Domestic mill lead times remain extended, spot availability is limited, and contract tons are tight. Hot-rolled lead times are averaging about 7.6 weeks, while cold rolled, galvanized and plate are around nine weeks—levels not seen consistently since 2021–2022. Our current mill conversations are also pointing to late-Q4 availability on some products. Fall maintenance is not creating the tight market, but planned outages could further constrain supply before conditions have a chance to normalize.
Imports are one area that could eventually help. U.S. steel imports increased 7.4% from June to July, according to the American Iron and Steel Institute, but total imports remain nearly 20% below last year on a year-to-date basis, with finished steel imports down more than 22%.
The challenge with offshore supply is timing. Buyers considering imports today are often planning 90 to 120 days ahead, putting arrivals into late Q4 or early Q1. With domestic availability still tight and little indication of a meaningful near-term shift, those opportunities should not be overlooked. For buyers with visibility into future needs, securing import tons can be an important part of the supply plan rather than waiting for domestic conditions to improve.
Pricing is still reflecting that tightness. Hot-rolled coil reached an average of $1,195 per ton in August and was still moving higher in the latest market assessments. At the same time, prime scrap has remained relatively stable, while the spread between HRC and busheling scrap widened to its highest level since January 2022. That disconnect points to a market being driven heavily by supply and availability rather than raw-material costs alone.
We may be getting closer to the point where buyers begin testing how much additional price the market can absorb, but there is still little evidence of a meaningful turn while availability remains constrained.
Demand is also giving the market support. The July ISM Manufacturing PMI reached 55.6, up 2.3 points from June and well above its 12-month average of 51.3. It was the strongest reading since May 2022, when the index reached 55.9. New orders and production also expanded in July, while customer inventories were still considered too low. ISM specifically listed steel and hot-rolled steel among commodities in short supply.
That matters because the market is dealing with improving manufacturing activity at the same time the steel supply chain is still working to rebuild inventory.
The strength is not uniform across every end market, but several steel-intensive sectors remain active. Energy infrastructure continues to support demand, with the U.S. Energy Information Administration reporting nearly 45 Bcf/day of new natural gas pipeline capacity planned for 2026 and 2027, roughly 70% of which is already under construction.
Data center construction also continues at a significant pace. Construction in that sector was up 46% year over year in June, even as broader private nonresidential construction spending weakened. The Department of Energy has also identified data centers, manufacturing and other large industrial loads as important drivers of future transmission needs.
Truck and trailer is showing early signs of improvement as well. ACT Research reported July trailer orders nearly doubled from a year ago, with 2027 orderboards opening earlier than normal. Construction overall remains more mixed, so we would be careful about calling demand broadly strong. What we are seeing instead is healthier manufacturing activity combined with several markets—energy, data centers and infrastructure—that continue to consume meaningful steel capacity.
Inventory adds another layer. Across the broader steel supply chain, flat-rolled inventories stood at 2.07 months of supply in July—more than 22% below July 2025 levels. At the same time, material on order reached 1.93 million tons, the highest level since October 2023, as distributors work to rebuild positions and secure future supply.
Some of today’s buying, therefore, is replenishment rather than new end-use demand. Mills are being asked to support current consumption while material is also moving back into the supply chain. Until inventories rebuild—or demand slows enough to take pressure off supply—that activity can continue to support longer lead times and firm pricing.
For buyers, the takeaway is to plan further ahead than normal, stay close to forecasts and maintain flexibility where possible on timing and specifications. If material becomes available that fits a known need, it may be worth securing rather than assuming the same opportunity will be there later.
Imports and additional supply could eventually loosen the market, but we would not build a near-term purchasing strategy around that assumption. For now, availability remains tight, and buyers with visibility into their future needs are in the best position to manage through it.
For buyers, the takeaway is to plan further ahead than normal, stay close to forecasts and maintain flexibility where possible on timing and specifications. If material becomes available that fits a known need, it may be worth securing rather than assuming the same opportunity will be there later.
Imports and additional supply could eventually loosen the market, but we would not build a near-term purchasing strategy around that assumption. For now, availability remains tight, and buyers with visibility into their future needs are in the best position to manage through it.