According to the American Iron and Steel Institute (AISI), US steel capacity utilization rate has reached and remained above pre-pandemic levels of 80%. For the market to reach this rate indicates that there is more steel available than in the previously supply-constrained market.

However, in parallel, Argus’ US Midwest hot-rolled coil assessment has increased by 2% or USD 33.75/short-ton in the past three weeks, akin to pandemic level increases. This marks a continuous rise in prices that have quadrupled since its low of USD 450/short-ton in mid-August 2020.

Despite US Steel mills increasing their utilization, few domestic buyers are looking to restock depleted steel inventories. Nonetheless, some steelmakers have posted record profits and expect to show even stronger results in Q3 due to the high price levels.

Conventionally, when steel costs rise, imports appear as lower-cost alternatives, but these have not been arriving in sufficient numbers or at substantial discounts to be significant in the market. In April, total steel imports were 2.4 mill. tonnes, down 5% compared with the year prior.

Some traders said that an increase in flat-rolled US imports will come in from June to August, but sentiment is that not enough steel will come through to fill the gap in inventory.