Analysis
August 7, 2026
HR sources stress a spot(less) market
Written by Kristen DiLandro
Recent conversations with hot-rolled (HR) coil spot market participants revealed spiking stress levels amid a tightening supply of steel sheet.
Some sources expressed doubt about whether demand would hold through the rest of the year. But if it does, they said they would have issues serving customers if not enough import arrives to supplement domestic HR.
Market Commentary
A few sources said mills will not sell them any spot HR. However, most mills continue to sell HR in the mid-levels of their min-max contract volumes. SMU has not received confirmation from the mills’ regarding volume policies.
A Midwest-based mill source said demand remains high and spot capacity continues to be booked through the fall. “Market remains good, with more and more customers requesting more volume from us than before, new customers coming out of the woodwork, and requests starting early for contract negotiations,” he said.
A distributor in the same region lamented current market conditions. He contended that sustained demand at current levels would make it difficult to serve customers in a timely manner. “It seems the mills are trying to get caught up. I still have six orders that are late with [domestic mills],” he said.
He remains optimistic about demand, but he’s not sure whether it will remain strong. “July was a very strong month for us both in sales, gross profit, and tons. Based on what my salespeople are telling me, it’s a mixed bag in both the manufacturing and fabrication world and the HVAC mechanical contractor’s world,” he said. “Some customers are swamped, but the business across the street is slow and looking for work.”
A third Midwestern market participant echoed sentiments from both the mill source and the service center source. “The demand is ok, but HR is getting very, very tight. We’re starting to see resistance from buyers to the prices of prime grades of HR,” he said. He also noted that his firm bought imported HR to support inventory but sold through it quickly.
Prices
SMU’s weekly price assessment for HR stands at $1,180 per short ton (st) on average, up from $15/st from our last check of the market.
