On Monday October 13, the report expressed “cautious optimism” as it forecast “modest growth” in global steel demand in 2026, compared with flat demand volumes expected for 2025.
Worldsteel attributed the anticipated shift in trend to a moderation in the decline of Chinese steel demand, growth signs in developing economies such as India, Saudi Arabia, Egypt and Vietnam – and “the long-awaited return of steel demand growth in Europe.”
However, high production costs, paired with cost pressures on consumers, trade tensions and shifting geopolitical dynamics are some of the key factors currently “dampening” steel demand across international markets, Worldsteel said.
China’s decline expected to decelerate
According to Worldsteel, Chinese steel demand will drop further by approximately 2% in 2025, marking a slowdown from when the market started to decline in 2021. The decline is forecasted to drop to 1% in 2026.
The reduction is a “moderation” of the declining trend, which is primarily driven by an “ongoing downturn” in the east Asian country’s housing market, the association said.
Worldsteel warned, however, that risks to its current China steel demand outlook “weigh on the downside” amid growing global protectionism and financial pressures on local governments.
Recently, escalating trade tensions between the US and China have weighed on steel market sentiment and prices, as well as a poor demand outlook.
Fastmarkets assessed the price of domestic hot-rolled coil, ex-warehouse Eastern China, at 3,380-3,390 yuan ($474-475) per tonne on Friday October 17, compared with 3,420-3,430 yuan on September 17.
Member mills of the China Iron & Steel Association (CISA) sharply reduced crude steel production in late September to levels not seen since the beginning of 2024, due largely to local environmental restrictions, but production sentiment was also said to be impacted by weaker finished steel prices and high stocks.
The world’s largest steel producer recorder a 0.7% drop in output to 77.4 million tonnes in August from the same time last year, according to Worldsteel’s data.
China produced 671.8 million tonnes of steel between January-August, down by 2.8% compared with the same period in 2024.
India keeps on growing
Meanwhile, the association forecasts that India’s steel consumption will continue to grow, rising by around 9% between 2025 and 2026, with expectations that local steel demand will increase by 75 million tonnes compared with 2020.
India had consistent growth in steel production, supported by strong domestic consumption for steel and a robust infrastructure sector.
While the construction sector is expected to remain strong, according to Fastmarkets’ research team, recent production capacity expansion has put pressure on prices. The introduction of safeguard duties on imports in April has also negatively impacted the market.
Meanwhile, a recent reduction of the country’s goods and services tax on cement from 28% to 18%, is also expected to favor steel consumption in the country further, according to Fastmarkets research team.
Strong demand forecasts for India accompanied high output figures this year, with the south Asian country having produced 14.1 million tonnes of steel in August, up by 13.2% year on year, according to Worldsteel data.
Meanwhile, the country produced 108.9 million tonnes between January-August 2025, an increase of 10.2% compared with the same period in 2024.
Steel demand in the developing world (excluding China) is expected to grow significantly by about 3.4 % in 2025 and 4.7 % in 2026, with this expansion expected to be driven chiefly by strong demand in India, and growth in some Association of Southeast Asian Nations and Middle East-North Africa countries, Worldsteel added.
Demand for Saudi steel also grows
Saudi Arabia was also among Worldsteel’s list of developing economies set to experience growth in steel demand in the coming months, contributing to the increase in global consumption.
Saudi Arabia’s increased demand for steel can be linked to a number of factors that have contributed to the development of its steel industry.
These include the government’s Saudi Vision 2030 program, which aims to diversify the country’s economy from its dependence on crude oil by allocating more funds to other key sectors, including construction.
Currently, the country is investing in major infrastructure project, which are set to boost local steel demand.
Outlook for leading producers
Leading steel producers are forecasted to experience demand growth in the future.
According to Worldsteel, steel demand in the US is expected to increase by 1.8% in 2025, thanks to “front-loading of production ahead of increased tariffs and continued growth in infrastructure spending,” the association said.
Lower levels of market uncertainty, private investments and a growing construction sector are also going to support steel demand in the US, Worldsteel said.
Based on Worldsteel data, the US reported a 3.2% rise in steel production to 7.2 million tonnes in August 2025.
Meanwhile, steel demand in the EU and UK is expected to increase by 1.3% in 2025 and 3.2% in 2026, Worldsteel said.
According to the association, the growing demand for steel in the EU is the result of “increased infrastructure and defense spending” across the region, as well as “improving” macroeconomic conditions, including inflation and household income.
In September, the European Steel Association (Eurofer) updated its outlook for apparent steel consumption across EU member states, predicting a decline of 0.2% to 128 million tonnes in 2025, compared with 129 million tonnes in 2024.
However, despite apparent steel demand experiencing two quarterly rebounds in late 2024 and in early 2025, consumption remains below pre-pandemic levels, Eurofer said.
Africa experiences upward trend
Despite years of muted market growth, steel demand in Africa has grown by around 5.5% per year over the past three years, according to Worldsteel data, especially in the continent’s northern and eastern regions.
According to the association, the trend is supported by developing economies, stability and reduced market volatility, as well as a strong construction sector.
Egypt was also mentioned in the association’s list of developing economies experiencing growth in steel demand.
Fastmarkets assessed the price for steel reinforcing bar (rebar) domestic, exw Egypt at E£33,000-38,200 ($693.75-803.07) per tonne on Thursday October 16, compared with E£32,000-38,200 per tonne on September 11.
Central and South America to follow trend
Worldsteel predicts 5.5% growth in the region’s steel demand this year, primarily driven by positive outlooks for the Argentinian and Brazilian markets. According to the association, the forecast is expected to boost the region’s steel demand to around 50 million tonnes.
