WSD Take: ‘Ain’t no Stopping us Now’
WSD reaffirms its call: pricing should continue its methodical $5 to $10 per ton march toward $1,200, with little to sap that momentum through the balance of the summer. The rally is now in its eighth straight month, having carried HRC from the high $700s to a likely $1,200 by July, and WSD does not expect much softening before early fall. The path of least resistance is still up.
Trade policy remains the dominant variable shaping US supply. At the one-year mark of 50% steel tariffs, and with a USMCA renegotiation underway but an agreement not coming in the immediate term, imports from Canada and Mexico have fallen by roughly 3 million tons on an annualized basis versus 2024 levels—essentially the equivalent of pulling an entire sheet mill out of the market. The one genuine pressure release is also trade: prices near $1,200 are pulling buyers back toward foreign material, and even with tariffs and elevated freight rates, the arbitrage is becoming too wide to ignore (especially as spot material in the domestic market remains virtually non-existent).
Demand is sharply bifurcated. Strength is concentrated on the construction side, driven by the AI infrastructure buildout, the tail end of spending from the 2021 bipartisan infrastructure bill, and a swelling energy infrastructure program. The buildout has real legs: project backlogs run years forward, companies like Google are already acquiring land for data centers that, in some cases, will not break ground for five to ten years, and lead times on transmission material and equipment are so long that the system simply cannot build fast enough. The contrast with the consumer economy is stark: residential, automotive, and appliances all remain notably weak, with consumer confidence low.
Coming out of last week’s Global Steel Dynamics Forum in New York, WSD reaffirms its forecast: a market that is tight, climbing, and showing little inclination to turn before fall. HRC is quickly approaching $1,150 per ton, lead times continue to stretch, spot availability is thin, and in the immediate term import volumes are not sufficient to reduce market pressure.