U.S. Midwest sheet prices have continued to rise with gains of $40/s.ton from our January 14 assessment. Prices are now up $136/s.ton – $178/s.ton from the lows assessed this past September and October.

Higher prices continued to be supported by tight supply, primarily for HR coil. As we covered last month, imports remained low, due to low domestic prices in Q3 2025 and Q4 2025. These low prices limited the competitiveness of imports, inclusive of the 50% S232. Today, we continue to see the results of this as import arrivals so far in January were down just over 400 kt y/y.

As domestic buyers have increased orders, mills have fallen behind in production for various reasons including recent winter storms, production issues, and delays to slab supply, among others. Due to this, lead times remained extended with HR coil near six weeks, while CR and HDG coil are near seven weeks, per Steel Market Update. This increase of orders at mills has come about alongside seasonal demand gains (see following chart). Buyers have noted that demand is currently higher than levels seen before the year end. Additionally, some service centers have reported that end users in construction and some manufacturing segments have increased production plans for early Q2 2026, requiring higher order levels at mills today.

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The CME Group HR Coil futures market has seen both daily trading volume and open interest jump this year. While trading activity has increased, forward curve prices have risen only marginally and are susceptible to strong moves in the physical market.

This commentary covers CME Group HR Coil futures at market close on Monday, February 9. Prices moved only marginally higher since our last review on January 12. The forward curve currently is pricing in a February peak at $977/s.ton followed by a decline of 8.5% by Q4 2026. For 2026 as a whole, futures are pricing in an average of $930/s.ton, a m/m increase of $8/s.ton with a spread of just $83/s.ton from the high to the low. Since 2013, the annual spread in prices has averaged $394/s.ton, obviously skewed by the pandemic era. Yet the lowest the spread seen was $80/s.ton in 2014 and $85/s.ton in 2017.

This trend of higher prices in Q1 2026 and lower prices in Q4 is the same shape as CRU’s forecast, though we continue to expect HR Coil prices to push through the $1,000 /s.ton threshold before reaching a peak. We also see prices falling back at a sharper rate later this year. From March through December 2025, all months where the S232 was in place, prices peaked at $945/s.ton in April before falling $137/s.ton by September. It is likely that peak to trough volatility in 2026 will be larger than what the forward curve currently suggests.

While prices have only shown limited movement, daily trading volume and open interest have continued to rise so far this year. Open interest at the end of January was near 688,000 s.tons and up 6.1% from the end of December. Open interest for February, as of this past Monday, was up 19.5% y/y, while contracts for March – May are up 55% y/y.

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