Steel is a fundamental pillar of a healthy economy, essential for infrastructure, construction, and industrial development. Industrialisation typically starts with the establishment of a domestic steel industry.
However, some formerly developing countries struggle to scale down their steel production once they reach a mature industrial stage. Meanwhile, other countries continue to expand their steel industries, often guided by government strategies aimed at boosting exports. This dynamic has led to production capacities far exceeding global demand.
As of 2024, global steel overcapacity exceeded 602 million tonnes - more than 4 times the EU’s total annual steel consumption – and is projected to rise to 721 million tonnes by 2027. Despite the growing mismatch, capacity reductions are frequently delayed or avoided due to government intervention, resulting in entrenched structural overcapacity and significant market distortions.
As a consequence, EU steel trade deficit has massively widened since 2021. A positive trade balance in finished steel products of 11 million tonne in 2013 has turned into a deficit of 10.7 million tonnes in 2024.
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Brussels, 11 September 2025 – The lack of a solution for steel in the EU-U.S. trade negotiations, the ongoing unpredictability of the global geoeconomic situation, and persistently weak demand against an ever-growing global steel overcapacity are squeezing the European steel market. In 2025, the outlook points to stagnation, with potential recovery only in 2026 — conditional on improvements in the global economy and an easing of trade tensions. According to EUROFER’s latest Economic and Steel Market Outlook, another recession both in apparent steel consumption (-0.2%, revised upwards from -0.9%) and in steel-using sectors (-0.7%, revised downwards from -0.5%) is confirmed for 2025. Growth prospects are now delayed at least to 2026, with projections of a rebound for both apparent steel consumption (+3.1%) and steel-using sectors (+1.8%). However, steel imports continue to hold historically high market shares (25%) in 2025.
Third quarter 2025 report. Data up to, and including, first quarter 2025
Brussels, 10 September 2025 – Reacting to today’s State of the Union Address delivered by Commission President Ursula von der Leyen, Axel Eggert, Director General of the European Steel Association (EUROFER) said: