The US HRC market is benefiting from a diversified demand profile that provides resilience against weakness in any single end-use sector. Infrastructure spending under the IIJA remains a steady source of demand, with federal disbursements for highway and bridge projects up 8% year-on-year.
Energy sector demand for steel products is growing 5% year-on-year, driven by oil and gas drilling activity and renewable energy project construction. The Permian Basin remains one of the largest markets for OCTG and line pipe, while wind turbine tower fabrication consumes significant tonnages of heavy-gauge plate.
Commercial construction has softened, with office building construction declining 2% year-on-year as the post-pandemic adjustments continue. However, warehouse and data center construction remains strong, partially offsetting the office segment weakness.
Automotive demand for HRC is stable, with US light vehicle sales running at approximately 16 million units annualized, broadly in line with 2025. The steel intensity per vehicle continues to decline gradually as material substitution and lightweighting trends persist.
The demand outlook for H2 2026 is cautiously positive. Infrastructure disbursements are expected to accelerate as the IIJA enters its peak spending years, and energy sector demand should remain supported by elevated oil prices above $90/bbl.
HRC at $1,100-1,200/st represents a reasonable equilibrium level. Buyers should monitor commercial construction data as the primary downside risk. Infrastructure and energy demand provide a reliable floor. Standard 3-6 month forward coverage is appropriate at current levels.