North America Steel: Flat Steel Prices Peaking, But Super-Profits Look Sticky

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North America Steel: Flat Steel Prices Peaking, But Super-Profits Look Sticky

North America Steel

06 July 2026 Citi Research

Steel Sector Update

We remain broadly bullish on the US steel sector expecting tariffs to support an

extended window of super-profits.

The US remains import reliant – averaging 1.5-2.0mt per month even with 50%+

tariffs on every ton. Domestic mills can generally price vs imports, not each other &

capture the tariff as profits. (Note: that dynamic would likely shift in a recessionary

market).

There is a pathway to closing the import gap – but at least 5 years away, in our

view. E.g. the US now imports ~500,000kt per month of sheet = 6 mt annualized.

NUE WV (3mt), Hyundai (3mt) and the planned NS-USS mill (3mt) could fill this

gap. But that will take 5-10 years… and sheet demand will likely be 2-6mt higher

by then (1-2%) CAGR.

Figure 1. Monthly Steel Imports (3M Rolling)

© 2026 Citigroup Inc. No redistribution without Citigroup’s written permission.

Source: Citi Research, US DoC (Trade.gov)

We forecast HRC steel prices ending 2026 at ~$1,100/st and averaging ~$1,000/st

in 2027E. Key Points:

n The increase in S232 steel tariffs to 50% created a ~10% supply shock to the

US steel market in 2H25/early 2026. Production + imports averaged ~9.0mt in

2024-1H25 but declined to 8.0mt by Feb 2026 driven by a large drop in imports.

n Supply has largely rebuilt in the past 2-3 months rising back to ~9.0mt level

in May (based on preliminary import data). This has been due to a combination

of higher domestic & import supply.

n Underlying steel demand is harder to assess but is up in the 2-3% range

driven mostly by construction/energy, in our view. Long steel demand is a bit

better than flat steel demand. Mills are describing booming demand – but this