Steel Industry Overview 2025
In last year’s Steel Industry Outlook, we noted signs of stabilization after several years of global shocks. Supply chains were regaining footing, mill output had normalized, and pricing was less erratic than the pandemic-era peaks. Still, we cautioned that volatility hadn’t gone away, it had simply changed shape.
That prediction has largely held true. Now, mid-way through 2025, the steel market is once again shifting. So what should buyers expect the remainder of the year?
Below, we break down the key drivers shaping the steel market in 2025. As we will explore below, tariffs are just one piece of the puzzle: from trade policy to pricing swings, it’s clear that steel buyers can’t predict what’s coming next. That’s why the most important strategy isn’t trying to guess the market, but finding a supply chain partner who can help you adapt to it.
Continued Volatility in the Steel Market
2024 was another volatility story: hot-rolled coil (HRC) prices fell over 40% last year to close near the $700 per short ton level from $1,200 per short ton at the beginning of 2024.
Entering 2025, most steel industry forecasts projected a modest recovery after this downturn. Fitch noted that improvements were expected due to “a more balanced Chinese steel market, falling costs and a slight rise in prices and producers’ margins.” Now in 2025, prices have already surged to over $900 per ton.
Many forecasts for global steel production have been pulled back from 2025. For example, according to forecasts from Fastmarkets, global crude steel production is at 1.846bn, down 34 million tons from estimates earlier in the year.
In North America, mill utilization rates have dropped below 70% after peaking mid-2024, reflecting softer order books in key sectors like construction, agriculture, and manufacturing.
What steel industry trends are driving continued pricing volatility?
While steel prices are always influenced by macroeconomic cycles, today’s volatility is particularly nuanced. It stems from a web of interconnected factors: trade policy, supply disruptions, shifting end-user demand, and environmental regulations.
Each variable influences the next, making the pricing environment harder to predict and more sensitive to sudden change. Below are some of the most impactful trends we’re watching in 2025.
A Multi-Faceted Impact from Tariffs
In March 2025, the U.S. government reinstated Section 232 tariffs, imposing a 25% duty on imported steel and aluminum. Unlike previous iterations, this round closed key exemptions, most notably for Canada and Mexico, marking a major shift for the North American steel market. The stated goal is to protect domestic producers and curb reliance on imported steel, which made up 23% of U.S. supply as of 2024.
The pricing impact was immediate. U.S. hot-rolled coil (HRC) jumped 15% in Q1, with projections climbing to $1,100 per ton by midyear.
On June 3, 2025, Section 232 was amended increasing tariffs to 50% on certain imports of steel articles and derivatives from all countries except the UK. This acceleration in tariffs will only add to the price momentum.
The market dynamics of this policy in the steel market will be incredibly complex to predict. Analyzing international trade policy is beyond the scope of this article, but this report does a good job of highlighting the complex issues at play, as outlined below.
Key Benefits
Greater Domestic Market Share: U.S. mills could benefit from increased demand as higher tariffs push foreign competitors out of the market.
Improved Profitability: Reduced import competition allows domestic producers to raise prices, boosting profit margins.
Opportunities for Reinvestment: The resulting revenue gains may enable mills to modernize equipment and expand production capacity.
Potential Risks
Limited Domestic Supply: The U.S. lacks sufficient steel and aluminum production (especially in niche grades) to fully satisfy demand, risking shortages and slower delivery timelines.
Market Instability: Sudden and significant tariff hikes create uncertainty, complicating long-term planning for both producers and their customers.
Impact on Downstream Industries: Higher prices could suppress demand and drive substantial job losses in steel-heavy sectors like construction and automotive, potentially triggering an unsustainable boom-bust cycle.
Reshoring Steel
Longer term, reshoring and domestic investment could offer a more stable path forward. Rising geopolitical tensions and pandemic-era lessons have pushed governments and manufacturers alike to prioritize domestic and regional self-sufficiency. These moves may not insulate the market from global shocks entirely, but they do offer a hedge against long-haul supply chain risks and trade dependency.
For buyers, a localized steel network means shorter lead times, more transparent sourcing, and greater control over quality and pricing (advantages that become more valuable with each and every market swing). We take a deeper look at reshoring and its benefits in our article here.[1]
Price Momentum in the Scrap Market
So far in 2025, scrap prices have shown strong growth as part of what Steel Industry News calls “a perfect storm of supply constraints and demand pressures”. Robust mill demand continues to outpace available supply, particularly as new electric arc furnace (EAF) capacity comes online. Tariffs are also expected to add volatility to both the volume and pricing of scrap metal from Mexico and Canada.
Construction Spending Appears Strong
Construction activity, a key driver of demand for the steel market, entered 2025 on a strong note, with one popular activity indicator, the Dodge Momentum Index, hitting all time highs in February. However, the most recent data show a sharp 7% downtick in March. “Increased uncertainty around material prices and fiscal policies may have begun to factor into planning decisions throughout March,” says Dodge Associate Director of Forecasting Sarah Martin, but “While planning data has weakened across most nonresidential sectors this month, activity remains considerably higher than year-ago levels and still suggests steady construction activity in mid-2026.”
Major Declines in the Agricultural Equipment Market
While demand from the construction sector remains strong, another key market for steel, agricultural equipment, is struggling through a market decline (ie. 15.8 YOY decline for large tractor sales in January) rooted in declining farm incomes, higher costs, and an excess supply of used equipment. The Farm Equipment Manufacturers Association reports that tariffs are a “perfect storm” for farm machinery and expects the market to remain unstable.
New EU Premiums for “Green Steel”
The EU’s Carbon Border Adjustment Mechanism (CBAM) is beginning to reshape global trade by placing a carbon price on imports like steel that don’t meet Europe’s emissions standards. While this creates strong incentives for low-carbon production within the EU, reporting from AZoMaterials suggests it hasn’t yet translated into widespread price premiums.
Many European producers are finding it difficult to recoup the higher costs of green steel, as downstream buyers remain price-sensitive and global markets (particularly the U.S.) lack similar carbon pricing or subsidy structures. As a result, green steel remains a cost center rather than a profit driver, at least in the short term. That could change if more countries implement comparable policies or if major buyers begin to prioritize verified low-carbon materials in procurement decisions.
Your Steel Supply Chain Partner for a Volatile Market
While pricing volatility may be out of your hands, how you respond to it doesn’t have to be. At Jade Sterling Steel, we help our customers stay competitive through value-added services that improve efficiency and control costs. From custom sizing and just-in-time delivery to mill-direct sourcing and inventory management, we offer practical tools to offset rising prices and reduce downstream waste.
For over 55 years, Jade Sterling Steel has been one of the nation’s premier distributors of steel bar and wire rod. Our 40,000+ ton inventory features a broad selection of grades, sizes, and finishing options, giving our customers the flexibility to select the best material for their needs. Whether you need a just-in-time delivery or a long-term supply chain partner, our team is here to help.
Please reach out to our team if you have any questions or topics you would like to see covered in the future.
