Though the ongoing conflict in West Asia presents a risk, global steel demand is projected to increase slightly by 0.3 percent to reach 1,724 million tonnes (mt) by 2026. Following this, an accelerated growth rate of 2.2 percent is expected in 2027, bringing demand to 1,762 mt, according to the short-range outlook (SRO) published by the World Steel Association. Nonetheless, the West Asia conflict is anticipated to negatively impact demand in that region in 2026.
After a prolonged period of decline, all major developed economies, including the European Union, the United States, Canada, Japan, and Korea, are expected to experience positive growth in 2027. Consequently, global steel demand, excluding China, is forecasted to grow by 4 percent that year. The current outlook is based on data available as of mid-March 2026, but the ongoing conflict in West Asia presents a significant stress test for these projections.
Steel demand from developed economies grew by 0.2 percent in 2025, ending a three-year consecutive decline that began in 2021. The outlook suggests that this stabilization will pave the way for gradual recovery, with growth expected to reach 1 percent in 2026 and gain momentum to 2.3 percent in 2027.
In the ASEAN region, steel demand growth is anticipated to moderate, slowing to 2.5 percent in 2026—a significant drop from the approximately 5 percent annual growth recorded in preceding years. This cooling trend is primarily driven by a sharp contraction in West Asia, where regional conflict has abrupt ly reversed earlier growth expectations.
The report predicts normalisation of demand across ASEAN economies. Following substantial growth in 2025, demand in this region is expected to soften temporarily as stockpiling activity declines. However, a more robust outlook for 2027 anticipates a rebound in growth to 5.1 percent.
Alfonso Hidalgo Calcerrada, Chief Economist at UNESID and Chair of the Worldsteel Economics Committee, noted that recent forecasts validate the trajectory established in the October 2025 SRO, confirming that global steel demand appears to be bottoming out during the 2025-2026 period. This follows a challenging phase of global structural adjustments that has suppressed demand since 2022. He stated, “We are now transitioning to a path of modest growth in 2026, with a more pronounced acceleration projected for 2027. This broader recovery is being driven by distinct shifts in regional dynamics.”
In China, the rate of demand contraction is expected to slow down in 2026, while growth in key markets, particularly India, remains strong. The contraction in Chinese steel demand is projected to narrow to -1.5 percent in 2026 as the housing market correction nears its nadir. Infrastructure investments are anticipated to increase, aided by local government efforts to sustain moderately strong GDP growth.
For 2027, Chinese steel demand is expected to remain largely flat compared to 2026 levels, as the correction in the real estate sector is likely to have largely concluded by that time, relieving the severe downward pressures that have characterized the industry since 2021.
Meanwhile, India is set to maintain its position as the world’s fastest-growing major steel market, with demand expected to expand by 7.4 percent in 2026 and accelerate to 9.2 percent in 2027. This strong growth is supported by sustained increases in infrastructure-related construction and a booming automotive sector, driven by rising freight demand.
Additionally, the ongoing capital expenditure cycle is expected to bolster demand for capital goods, while the expansion of the nationwide rail network and a surge in consumer durables, propelled by affordability, offer further structural advantages.
In Africa, substantial growth is predicted following a transformative shift since 2023, with a forecast of 3.8 percent growth in 2026 and 4.6 percent in 2027. This surge reflects an increased focus on large-scale urbanization, essential infrastructure development, and economic diversification efforts, establishing Africa as an increasingly important driver of the global steel market.
The EU and UK region’s demand is anticipated to grow by 1.3 percent in 2026 and 3 percent in 2027. This revival in steel demand reflects rising infrastructure and defense spending, coupled with improvements in macroeconomic conditions, including increases in real household income. However, significant exposure to energy price spikes remains a downside risk for 2026.
In the United States, steel demand is projected to advance by 1.7 percent in 2026 and 2 percent in 2027, buoyed by technology-driven and policy-supported private sector investments, along with sustained public infrastructure expenditures. The report states, “We anticipate a healthy recovery in the residential construction sector, driven by significant pent-up demand and gradually easing financing conditions.”
However, the pace of recovery may be constrained by ongoing structural challenges, including high material costs, elevated mortgage rates, affordability pressures, and continuing labor shortages. Additionally, demand for durable goods may weaken amid a softening labor market.
Published on April 17, 2026.
