2027 Contract Prices Are Already Being Set — And They're Nowhere Near 2026's
Buyers who lock in annual steel contracts are already looking at 2027 numbers, and they’re a lot bigger than what mills are charging today. That’s the story worth paying attention to this week — not another sideways scrap settlement, but the price mills expect to hold going into next year.
2027 contracts are pricing well above 2026
At SMU’s Steel Summit in August, CRU’s Josh Spoores told the room that next year’s fixed-price contracts are lining up around $1,100 to $1,175 a ton, compared to roughly $800 on 2026 contracts. That’s not a spot-market blip — fixed-price contracts are the numbers big buyers negotiate a year out, so a jump of that size reflects what mills genuinely expect supply and demand to look like in 2027, not just this week’s noise. Wells Fargo’s own outlook is more conservative, pegging 2027 around $1,000 a ton if current tariffs hold — still well above this year’s contract level either way.
The near-term supply picture explains why
The forward pricing isn’t happening in a vacuum. Fall and winter maintenance outages are set to pull more than 1 million tons of hot-rolled coil out of the US market between September and December, with September itself the most concentrated month — six separate facilities, including US Steel Gary and Big River Steel Works, cutting output at the same time. Spot HR coil has followed: prices were near $1,300 per ton in mid-September, and buyers report lead times running 8 to 12 weeks as mills work through booked orders with limited spot tons to spare.
Mills are running hot, not idle
This isn’t a capacity shortage in the sense of idled furnaces — it’s the opposite. Weekly capacity utilization sat at 78.3% for the week ended September 5, and year-to-date utilization has actually climbed from 77.1% to 79.0% versus the same period last year, with total output up 5.4% through early September. Mills are producing more steel than a year ago and are still tight — which is exactly the kind of setup that pushes forward contract pricing higher rather than lower.
What this means for your pins
If mills are already writing 2027 contracts 35-45% above this year’s level, that’s a strong signal alloy bar and forging costs aren’t coming down anytime soon — and likely head higher as 2027 supply agreements get finalized over the coming months. For a shredder operation, that argues for locking in wear-part orders and inventory now rather than waiting for a price dip that the mills themselves aren’t forecasting.
It also reinforces the value of staying on the domestic side of this market. Buyers exposed to import material are stacking tariff costs on top of a tightening global steel price; American-made pins avoid that layer entirely. The fundamentals — mill maintenance schedules, utilization, lead times — are the same for everyone, but the tariff exposure isn’t. Keep your pin-change schedule disciplined, hold a buffer of spares, and treat this fall’s price signals as a reason to plan your 2027 wear-part budget now, not in December when everyone else is doing the same math.