Hot Rolled Coils Price Index, Trend, Chart, News, Demand & Forecast

Hot Rolled Coil (HRC) Price Trends Q2 2025: Regional Dynamics Across North America, APAC, and Europe

Introduction

Hot Rolled Coil (HRC) is a critical raw material in the global steel industry, serving as the backbone for sectors such as automotive, construction, energy, heavy machinery, and infrastructure. Price fluctuations in HRC are not isolated events but reflect a confluence of trade policies, domestic industrial demand, global supply chains, and raw material costs.

In Q2 2025, the HRC market experienced divergent regional trends. While the United States saw a notable increase due to tariffs, import curtailments, and supply discipline, Malaysia faced price declines amid Chinese oversupply pressures and sluggish domestic activity. Meanwhile, Germany recorded one of the strongest price upswings in the European steel market, fueled by reduced imports and rising production costs.

This article examines the key drivers, supply-demand balances, and future outlook for the HRC market in these regions.

North America: U.S. HRC Prices Bolstered by Trade Protection and Supply Discipline

Price Movement in Q2 2025

In the United States, the Hot Rolled Coil Price Index rose by 5.2% quarter-over-quarter in Q2 2025. This growth reflected a deliberate combination of trade defense measures, reduced imports, and controlled domestic production strategies.

Key Drivers

1. Protective Tariffs and Trade Barriers

• The U.S. steel sector benefited from ongoing protective tariffs that limited the influx of cheaper foreign steel, particularly from Asia.
• Tariffs imposed on Chinese and Russian-origin HRC effectively shielded domestic mills, keeping foreign supply tight.

2. Reduced Imports

• Imports into the U.S. slowed significantly due to elevated freight costs, unfavorable trade measures, and currency exchange rate shifts.
• Buyers relying on imports had fewer options, making them turn toward domestic producers despite higher prices.

3. Supply-Side Discipline from Domestic Mills

• Domestic mills actively managed supply to prevent overproduction, with some facilities scheduling maintenance downtime.
• This artificial tightening of availability maintained a balance in favor of stronger pricing.

4. Demand Resilience in Construction and Manufacturing

• Construction activity remained relatively robust, supported by government infrastructure spending.
• The automotive sector, although cautious due to evolving EV transitions, maintained steady offtake of HRC.

Market Implications

The deliberate alignment of trade policies and supply strategies positioned U.S. mills with greater pricing power. Buyers, particularly in the automotive and energy infrastructure segments, faced constrained negotiation leverage.

Outlook for North America

Looking ahead to Q3 2025, U.S. HRC prices are expected to remain elevated, though the pace of growth may moderate. If imports pick up slightly or demand weakens seasonally, the upward trend could stabilize. However, government infrastructure projects and continued trade barriers should keep domestic pricing resilient.

Asia-Pacific: Malaysia Struggles Under Pressure of Chinese Oversupply

Price Movement in Q2 2025

In Malaysia, the Hot Rolled Coil Price Index declined by 5.2% quarter-over-quarter in Q2 2025. This downward trend highlighted structural challenges in balancing domestic demand with rising import volumes from China.

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Key Drivers

1. Weaker Domestic Industrial Activity

• Manufacturing output in Malaysia slowed, particularly in sectors such as consumer goods and light machinery.
• Construction activity, a key consumer of HRC, remained muted due to limited new project starts and cautious financing environments.

2. Inflow of Low-Cost Chinese Imports

• Chinese steelmakers, facing oversupply domestically, aggressively exported HRC into Southeast Asia at discounted rates.
• Malaysia, with relatively lower trade restrictions compared to the U.S. or Europe, absorbed significant volumes of these imports.

3. Competitive Pricing Pressure

• Domestic mills struggled to compete with the cheaper landed cost of Chinese material.
• Buyers preferred imports for cost efficiency, further eroding local mill margins.

4. Currency and Trade Factors

• A relatively weaker Malaysian ringgit against the U.S. dollar inflated import costs but did not offset the sheer competitiveness of Chinese offers.

Market Implications

Malaysia’s domestic steel industry faced mounting challenges, with mills losing pricing power. Profitability shrank as producers either matched import prices or risked losing market share. The competitive dynamics shifted the buyer’s advantage, creating deflationary pressure across the supply chain.

Outlook for APAC

Going into Q3 2025, Malaysian HRC prices may face further downside risks if Chinese exports remain aggressive. Unless regional governments consider implementing protective measures or unless Chinese domestic demand strengthens, Southeast Asia is likely to remain vulnerable to oversupply-driven pricing pressures.

Europe: German HRC Prices Surge Amid Import Shortages and Rising Costs

Price Movement in Q2 2025

In Germany, the Hot Rolled Coil Price Index surged by 7.4% quarter-over-quarter in Q2 2025. This made Germany one of the strongest-performing steel markets globally during the quarter.

Key Drivers

1. Constrained Imports

• European Union trade policies and anti-dumping measures limited HRC inflows from non-EU regions, particularly from Asia.
• Ongoing geopolitical tensions and logistics bottlenecks in shipping through the Red Sea further tightened supply routes into Europe.

2. Cost-Driven Price Hikes from EU Mills

• EU-based steelmakers faced rising production costs, particularly in energy and raw materials like iron ore and coking coal.
• Higher carbon emission compliance costs under the EU ETS (Emissions Trading System) further pressured mill margins, prompting price hikes.

3. Steady Demand from Automotive and Engineering Sectors

• Germany’s strong automotive base maintained consistent demand for HRC, particularly for flat steel applications in vehicles.
• The engineering and machinery manufacturing industries also contributed to stable offtake, ensuring that higher costs could be passed through to buyers.

4. Tight Domestic Availability

• Several European mills underwent maintenance shutdowns, keeping output limited during the quarter.
• This combination of lower supply and higher input costs created upward price momentum.

Market Implications

German buyers, especially in automotive supply chains, faced rising procurement costs that could ripple into finished product pricing. For steelmakers, this quarter represented an opportunity to restore margins after weaker performances in prior periods.

Outlook for Europe

In Q3 2025, German HRC prices may remain high if cost inflation persists and imports continue to be restricted. However, a potential slowdown in consumer demand across the EU could temper further sharp gains. Much will depend on whether energy costs stabilize and if trade inflows recover.

Comparative Regional Analysis

Divergent Trends

• United States (North America): Prices increased due to trade protection and controlled supply.
• Malaysia (APAC): Prices dropped under heavy Chinese export pressure and weak domestic demand.
• Germany (Europe): Prices rose sharply, supported by supply constraints and cost-driven adjustments.

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Trade Policy as a Key Differentiator

The most striking factor across these regions was the role of trade policy and protectionism. The U.S. and EU benefitted from barriers against low-cost imports, while Malaysia, with relatively open markets, was more vulnerable to global oversupply.

Cost Structures and Energy Prices

European mills bore the brunt of rising energy and carbon costs, which were absent in the U.S. and Malaysia to the same extent. This made cost inflation a stronger driver in Europe, while U.S. pricing was more about supply discipline and Malaysia about demand erosion.

Buyer Dynamics

• In the U.S. and Germany, buyers faced limited choices and had to accept higher prices.
• In Malaysia, buyers enjoyed stronger bargaining power, taking advantage of cheaper imports.

Future Outlook: What Lies Ahead for the Global HRC Market?

The global HRC market in the second half of 2025 is likely to remain fragmented with region-specific trends:

• North America: Prices are expected to hold firm, but any relaxation in supply control or rise in imports could cool the momentum. Infrastructure spending remains a bullish driver.
• APAC (Malaysia and wider Southeast Asia): The region will remain under pressure unless Chinese domestic demand absorbs more of its supply. Trade defense measures may emerge if local mills face sustained stress.
• Europe (Germany and wider EU): Prices will stay elevated due to structural cost challenges and import limits. However, EU demand-side risks, such as consumer slowdown, could pose a cap on further increases.

In the broader context, global steel dynamics will continue to be influenced by:

• Chinese export strategies and domestic demand recovery.
• Energy and raw material cost volatility.
• Ongoing geopolitical tensions disrupting supply chains.
• Government-led infrastructure investments across regions.

Conclusion

Q2 2025 highlighted how regional trade policies, supply dynamics, and cost structures can create vastly different outcomes in the global HRC market. The U.S. market gained pricing strength through tariffs and supply control, Malaysia struggled under the weight of Chinese oversupply, and Germany surged due to cost inflation and restricted imports.

These divergent patterns reinforce that while HRC is a globally traded commodity, local conditions—ranging from government policy to industrial demand—play a decisive role in shaping price trends. As the steel sector moves into Q3 2025, stakeholders across industries will need to closely monitor these interconnected variables to navigate procurement strategies effectively.

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