en.Wedoany.com Reported - The global steel industry is undergoing significant structural changes, shifting from a system dominated primarily by China and other East Asian countries to a more balanced and competitive global market.

Despite a gradual recovery in demand, with the World Steel Association forecasting growth over the next two years, oversupply remains a persistent issue. New capacity continues to outpace demand growth, leading to low capacity utilization rates and hundreds of millions of tons of excess capacity, putting sustained pressure on steel producers.

There are clear differences between traditional steel-producing countries and emerging markets. China's steel production and consumption have fallen below one billion tons for the first time since 2020; Japan, South Korea, and Germany have also cut output. In contrast, India is growing rapidly, with significant increases in both production and demand, and is expected to lead global economic growth. Meanwhile, regions such as Vietnam, the Middle East, and Africa are emerging as new demand centers.

Trade and government policies are also reshaping the market. Despite weak demand in China, its steel exports have reached record levels, with a greater focus on Southeast Asia and the Middle East. The United States and India are expanding local production and using protectionist policies to reduce imports and improve capacity utilization. Global trade is becoming increasingly restricted as tariffs and trade barriers rise.

The transition to low-carbon production presents new challenges. The European Union has launched the Carbon Border Adjustment Mechanism (CBAM), with free carbon emission allowances to be gradually phased out, leading to higher production costs for traditional steel. China has also included its steel industry in its carbon emissions trading system, pushing companies to reduce emissions.

Under the dual pressures of trade protection and environmental regulations, steel companies need to accelerate the transition to low-carbon production and develop higher value-added products to remain competitive in the evolving global market.

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