Worldsteel: Global steel demand flat, but modest rebound forecast for 2026 

India, Vietnam, Egypt, and Saudi Arabia are driving the 2026 growth projection. Worldsteel expects moderate demand increases in the UK and EU. Meanwhile, the association projects that US demand will continue to stagnate.

Key players amping up steel demand

Steel demand in India is expected to continue with ~9% growth over 2025 and 2026. Next year, the country’s steel demand is projected to be ~75 million mt higher than in 2020. 

Across the continent of Africa, steel demand has grown by an average of 5.5% per annum. The Northern and Eastern regions have been leading the demand for steel through major growth activities. As such, the continent’s demand for steel is ~41 million mt for 2025. Worldsteel expects a combination of reforms, economic diversification agendas, improved macroeconomic fundamentals, and governance to drive positive developments that sustain steel demand growth.

Worldsteel projects Central and South America’s steel demand this year will grow ~5.5%, pushing total steel demand to ~50 million mt. The demand, however, is 2 million mt lower than 2013 consumption. Argentina’s rebound is credited with turning steel demand around, jumping from a 30% decline in 2024. Brazil shares credit for the regional steel demand growth. Its government-supported housing scheme has been driving increases in steel demand across the construction sector. Brazil’s steel demand growth from 2024 is 5%.  

Rising defense and infrastructure investments are driving EU and UK steel demand. The forecast states demand will swell 3.2% in 2025. Macroeconomic factors like improvements in credit conditions, lower inflation, and improvements to real income are responsible for the uptick.

US stays on course, demand remains flat

US steel demand is projected to increase by 1.8% in 2025. The report attributes the rebound to front-loaded production to avert tariff expenses. Additionally, increases in infrastructure spending have amped up steel demand. Worldsteel projects US steel demand will grow by another 1.8% in 2026. It notes that demand will be driven by residential construction, private investment, changes to financing, and less overall market uncertainty.

China faces headwinds, demand expected to decrease

If worldsteel’s forecasts for India, Vietnam, Egypt, and Saudi Arabia materialize, the growth in these countries will offset China’s dwindling steel demand.  

The report anticipates Chinese demand will be down 2% this year. It blames the downturn in China’s housing market for the decrease. Once the market bottoms out, worldsteel notes, the demand decline will slow to 1% in 2026. Additionally, local economic factors constraining infrastructure investing and challenging global trade conditions are constricting China’s steel demand. 

Optimistic demand forecast with a giant warning label

Alfonso Hidalgo de Calcerrada, chief economist of the Spanish Steel Producers Association (UNESID) and chair of the worldsteel Economics Committee, believes worldsteel’s outlook holds promise.

“Despite a considerable escalation of the global trade war and inherent uncertainties, we are cautiously optimistic that global steel demand will bottom out in 2025 and demonstrate moderate growth in 2026,” said Calcerrada.

He stated that global economic conditions show more favorability overall than in previous periods. The economist highlighted that investments in public infrastructure projects in most major countries are driving steel demand.

“This positive outlook is underpinned by the demonstrated resilience of the global economy, continued strength in public infrastructure investments in most major economies of the world, and the expected ease in financing conditions,” he said.

While Calcerrada’s commentary is optimistic, he notes that a challenging global trade environment coupled with complications in the manufacturing sectors are causes for concern.

“The global manufacturing sector continues to face a squeeze from elevated production costs and sustained affordability pressures on consumers,” he said, adding, “Escalating trade tensions are having a direct, negative impact on steel demand in economies heavily reliant on the export of steel-intensive goods, such as machinery and automotive components.”

Finally, the economist warns, “Geopolitical uncertainties act as a major deterrent, chilling both consumer and investor confidence, and dampening steel demand across key markets.”