Metals Industry Update Q4 2024

The U.S. metals market experienced notable fluctuation in 2024, with significant price changes amid evolving supply-demand dynamics. The year began with hot-rolled coil prices at a high of over $1,000/ton, and then declined to the mid-$600 range by July. In the second half of the year, as imports became less attractive and supply decreased, prices found stability.

The U.S. Manufacturing PMI, though still in contraction, displayed signs of recovery in November as it recorded a reading of 49.7, up from 47.3 at the end of Q3. The improvement is thought to be influenced by the ‘America First’ trade policies associated with the incoming Trump administration. In December, however, optimism dampened due to rising inflation and increased raw material prices.

The latest proposed tariff plans aim to boost domestic demand and output, enabling American suppliers to compete more effectively with their foreign counterparts. While the imposition of these tariffs is expected to drive gains, the resultant strain on cross-border supply chains and increase in procurement costs would impact manufacturers’ margins as they would have to increasingly rely on pricier material sourced domestically.

Overall, the outlook for the metals industry remains strong. With the Fed signaling further rate cuts in 2025, consumption is expected to rise. Federal legislation, including the Infrastructure Bill and IRA, will underpin demand, as these initiatives require metals for construction, even if the primary focus of the legislation changes under the new administration.

Furthermore, the Steelmakers Association, in an effort to safeguard the country’s manufacturing sector in the long-term, has proposed a five-point plan to President Trump. The proposal urges strengthening of tariffs to support domestic manufacturing, while also standing up to unfair trade practices, stopping regulatory overreach, advancing pro-growth tax policy, and monetizing America’s environmental advantage.