The World Steel Association today released its Short-Range Outlook (SRO) for steel demand in 2026–2027. The report forecasts that global steel demand will edge up by 0.3% to 1,724 million tonnes in 2026, and then accelerate to 2.2% growth, reaching 1,762 million tonnes in 2027.

Commenting on the forecast, Mr. Alfonso Hidalgo Calcerrada, Chairman of the World Steel Association’s Market Research Committee and Chief Economist of the Spanish Steel Association, said:

“The latest forecast validates the trend we anticipated in our October 2025 report, confirming that global steel demand bottomed out during 2025–2026. This follows a prolonged and challenging phase of structural adjustment since 2022, which suppressed steel demand. We are now transitioning to a modest growth trajectory in 2026, with a more pronounced acceleration expected in 2027.

This broad-based recovery stems from a clear shift in regional dynamics. In 2026, the demand contraction in China will finally slow, while major developing countries, particularly India, will continue to see strong market demand. We had expected robust growth in the Middle East, but due to ongoing conflicts, steel demand in the region will drop sharply in 2026. Crucially, we anticipate a substantial turnaround across all developed economies. After a prolonged period of recession, major advanced economies such as the European Union, the United States, Canada, Japan, and South Korea are all expected to return to positive demand growth in 2027. As a result, we project that excluding China, global steel demand will accelerate to a 4.0% growth rate in 2027—a level rarely seen in recent years.

This forecast is based on data available through mid-March 2026, but the escalating conflict in the Middle East represents a significant stress test. Our core assumption remains that the conflict will be resolved by June; under this timeframe, we expect steel demand in most major economies to remain resilient. Specifically, the United States, China, and India are likely to be largely unaffected by its direct spillover effects. Moreover, despite higher exposure, the European Union has enhanced its systemic energy flexibility since the 2022 Russia-Ukraine crisis. The vast difference between the peak natural gas prices in 2022 and current price levels indicates that the impact so far has been much smaller.

However, if hostilities persist beyond the second quarter, a substantial downward revision will be necessary, particularly for regions with high energy sensitivity.

We expect the decline in China’s steel demand to narrow to -1.5% in 2026 as the real estate market adjustment nears its bottom. Infrastructure investment in China will rise slightly this year as local governments strive to maintain moderately strong GDP growth. We anticipate moderate growth in manufacturing steel demand, supported by continued export growth.

However, an increasingly challenging global trade environment remains a significant downside risk, which could dampen manufacturing steel demand in the coming years.”