What is the future prediction for steel?

History repeating itself is not a given in turbulent markets, but prices for recycled steel through June have followed a trend practically identical to 2024.

Last year, prices peaked in January and February before slumping in the spring and spending the second half of the year trading in a narrow band.

As the July trading period began, reports from Davis Index indicate mill buyers in the United States and overseas were making offers for recycled steel grades that were flat or trending upward in small increments.

“Our company and our competitors have seen manufacturing customers go out of business, and everyone keeps waiting for things to pick up.” – Great Lakes region recycler

In Turkey, the largest overseas market for U.S. recycled steel, buyers were making initial bids between $340-$345 per metric ton (cost and freight, or cfr) for heavy melting steel (HMS), according to Davis Index.

Those bids—as well as one transaction recorded—did not budge the pricing service’s index figures for July from beyond the levels established during the June buying period. Those June figures, in turn, varied only slightly from prices recorded in May.

Domestic mill purchases from April 21 to June 20 measured by the Raw Material Data Aggregation Service (RMDAS) of Pittsburgh-based MSA Inc. portray the same flat market that characterized the final eight months of 2024.

The RMDAS figures show shippers were paid within a $5-per-ton range for three benchmark grades of recycled steel during the 60-day period—No. 1 HMS, No. 2 shredded scrap and the prompt industrial composite grade consisting of factory-generated busheling and bundles.

Domestic mills paid a national average for No. 1 HMS that rose by just $1 per ton in the mid-May-to-mid-June buying period compared with the previous 30 days, according to MSA. The other benchmark obsolete grade RMDAS tracks, No. 2 shredded scrap, rose by just $2 per ton in May and June.

Showing only slightly more improvement was the RMDAS prompt industrial composite grade, which rose an average of $3 per ton in the U.S. in late May and the first three weeks of June.

The last time prices spiked, winter weather that constrained supply was a leading factor. Regarding supply this spring, a recycler in the Great Lakes region portrays an uninspiring landscape, though flows seem sufficient to keep overseas and domestic buyers fed.

The recycler says he is waiting for recycled steel volumes generated by the manufacturing sector in his region—which is near the Canadian border—to rebound, but he has been waiting for some time.

“We felt [the rebound] would begin in October 2023, and then thought we would see improvements in the first quarter of 2024, then the second quarter and third quarter, and then after the election—and none of it has materialized,” he says.

“Our company and our competitors have seen manufacturing customers go out of business, and everyone keeps waiting for things to pick up. It is tough, to say the least.”

When asked about the new frontier of tariffs imposed on longtime trading partner Canada, he says, “The biggest impact I’ve seen is the push of scrap from Canada into our markets while their mills keep buying less and less.

“Since scrap is not [yet] tariffed, Canada has pushed as much prime scrap into the U.S. as it can. The normal flows are disrupted, adding more difficulty to an already difficult situation.”

As traders geared up for the July buying period, they likely kept an eye on U.S. steel production figures from the Washington-based American Iron and Steel Institute (AISI).

Through July 5, about 45.2 million tons of steel were made in the U.S., according to AISI, with mills operating at an average capability utilization (capacity) rate of 76 percent.

That counts as a modest 0.5 percent improvement compared with slightly less than 45 million tons made in the same timeframe in 2024, when mills were operating at a 76.2 percent capacity rate.

Steelmakers and suppliers alike will be watching to see if the 50 percent tariff on inbound steel will spur even more domestic production in the second half of this year.

The AISI roundup for the week ending July 5 could be considered encouraging in that context as more than 1.78 million tons of steel were made in the U.S. that week, with mills running at a 78.6 percent capacity rate.

That tonnage figure is up by 4.9 percent compared with the less than 1.7 million tons made during the comparable week in 2024 and also represents a 0.3 increase in output compared with the prior week.