CRU Outlook: US sheet price outperformance set to continue

We continue to expect the current US price trend will reach a peak in Q3’26 as inventory tightness starts to ease via rising imports, while US Steel’s Gary #14 furnace returns from extended maintenance. Near-term upside risk includes additional maintenance outages as well as the labor contract expiration on Sept. 1 between the USW (United Steelworkers) and two large steel producers. The negotiation process could potentially interrupt production.

In Europe, prices have bounced immediately following the introduction of the new tariff-rate quotas, rising by roughly €10-15/t in early July. Our forecast has been that increasing the value proposition of domestic vs. import supply would push prices higher in a short-term cycle, but also establish a new, longer-term higher price floor. This remains the view; however, with prices jumping in week one of the new system, there is a risk that the short-term upcycle could happen more rapidly. We expect that demand weakness and seasonality will contribute to price increases being more in September than in August.

Chinese HR coil prices edged down RMB40/mt ($8/mt) in July, driven by seasonal demand softness in construction and elevated mill output. Inventory has built across major sheet products. Near-term price direction hinges on the pace of destocking and whether mills curtail production.

Indian sheet prices dipped slightly in July and are expected to fall again in August amid rising inventories and mill supply. However, delayed capacity additions from JSW Steel and AM/NS India are keeping the market tighter than previously expected.

In Southeast Asia, prices are expected to trough around mid-August before recovering modestly ahead of the Q4 seasonal upturn. Hoa Phat’s blast furnace maintenance from July 20 provides near-term supply support, while higher Chinese export volumes remain the primary downside risk.

CRU premium subscribers can access the full sheet forecast here.