Metals Industry Update Q1 2026

The US metals sector moved through Q1 2026 against a supportive industrial landscape. Manufacturing activity remained in expansion, with the S&P Global US Manufacturing PMI ending the quarter at 52.3 — showing strength in output and new orders, even as cost pressures and supply delays persist. At the same time, the Fed left interest rates unchanged after December 2025, underscoring a still-cautious economic and financial backdrop.

Trade policy continued to shape commercial behavior across the value chain. The 50% Section 232 tariff regime reinforced domestic sourcing and limited competitiveness of foreign metals. Consistent with this landscape, the American Iron and Steel Institute (AISI) reported a marked decline in steel imports in Q1 vs. prior year levels, lending support for domestic mill pricing, but also increasing costs for downstream manufacturers.

End market demand broadly remained resilient. Construction activity stayed robust, with strong project starts in the data center, commercial, and select public infrastructure categories. Despite some projected improvement in March, automotive was relatively soft as higher vehicle prices, combined with ongoing inflationary pressures and still‑elevated interest rates, continued to influence the market.

In the closing weeks of the quarter, geopolitical developments in the Middle East started to spread through industrial supply chains, primarily via higher energy and freight costs. This led to some extension in delivery timelines and added uncertainty to near‑term planning, while its full impact on market behavior is yet to unfold.

Finally, the World Steel Association’s latest outlook projects the US market to register growth of 1.7% in 2026 and 2.0% in 2027, with momentum supported by technology‑linked and policy‑backed private investment along with continued public infrastructure funding. However, elevated input costs and higher interest rates are likely to limit the upside.