Global steel demand is expected to shrink slightly this year, with the World Steel Association on Monday cutting its forecast as weaker demand in China and disruption from the US-Israeli war with Iran weigh on consumption.
The industry body now expects global steel demand to fall 0.1% in 2026, compared with a forecast in April for growth of 0.3%.
“The anticipated recovery is proving slower and more gradual than we had expected,” said Alfonso Hidalgo de Calcerrada, chair of World Steel’s economics committee.
The group also cut its 2027 demand growth forecast to 1.7% from 2.2%.
Steel demand in China is expected to fall 2% this year as the country’s property downturn continues for longer than the association had anticipated.
The outlook for Europe has also weakened. The association now expects steel demand in the European Union and Britain to fall 0.3% in 2026, reversing its previous forecast for growth of 1.3%, as a recovery in construction proves slower and more uneven than expected.
The slowdown is even more pronounced in the Gulf, where steel demand is forecast to fall 11% in 2026 before rebounding 11.3% in 2027.
“What we observe (in the Gulf) is not the destruction of demand but its deferral, as project awards, construction starts and financing decisions are pushed back while the security situation remains unresolved,” Hidalgo de Calcerrada said.
“Steel demand in the Gulf should recover strongly once the uncertainty clears, the Strait of Hormuz reopens, and the supply chains normalise.”
The association reiterated that India remains the world’s fastest-growing major steel market, with demand forecast to grow 7.9% in 2026 and 8% in 2027.
(Reporting by Javi West Larrañaga. Editing by Mark Potter)
