The central character determining how the global steel industry will perform in 2026 is the US President, Donald Trump. However, although his steel tariffs will continue to have their effect, it could well be his decision making in other fields which causes even greater effect. As demonstrated by his kidnapping of Venezuela´s President, Nicolás Maduro, Donald Trump has no regard for the rule of international law. So, will such recklessness perhaps precipitate a war with Russia in Europe? Will the Middle East erupt under his shrewd guidance? Will trade and Taiwan tensions with China parlay into a military conflict? Given Mr Trump´s capricious nature, anyone trying to forecast the direction steel prices will take this year may care to recall the words of the Nobel Prize-winning Danish physicist, Niels Bohr: “Prediction is very difficult, especially if it’s about the future”. Nevertheless, the World Steel Association (WSA) in its October Short-Range Outlook (SRO) and the global credit ratings agency, Fitch Ratings,

have both offered their take on the year ahead. After flat demand in 2025, the WSA expects a modest rebound of 1.3% in 2026, pushing global demand to 1,773 million metric tonnes (Mm/t). “This positive outlook is underpinned by the demonstrated resilience of the global economy, continued strength in public infrastructure investments in most major economies of the world, and the expected easing in financing conditions,” the WSA said in its SRO. That said, the WSA sees demand in China falling by 1% this year as the housing market downturn finally bottoms out. Meanwhile, Fitch Ratings announced in late December: “We expect China’s steel output to decline by 4.5% due to tighter production controls and increased trade barriers, which will slightly reduce exports from our forecast of 118 Mm/t in 2025 to 109 Mm/t in 2026. Chinese steel producers’ margins recovered in 2025, and we expect further improvement into 2026, supported by efficiency gains and declining costs”.

The WSA sees steel demand in the United States growing by 1.8% in 2026, aided by pent-up demand in residential construction and private investment, easing financing conditions, and reduced uncertainty. Fitch Ratings also sees demand improvement, supported by governments policies. In the Europe + UK region, the WSA anticipates a 3.2% demand increase in 2026. “The long-awaited return of steel demand growth in the EU reflects the impact of increased infrastructure and defence spending in the continent in combination with improving macroeconomic conditions,” it said. Fitch Ratings agrees, citing the tightening of import quotas to 50% and stricter control over the country of origin of steel as being useful measures. “In addition, the carbon border adjustment mechanism will be introduced from 2026 and will gradually raise the cost of carbon for imports,” the agency said.

India will play a key role in 2026, given that it is now the second-largest steel producing nation in the world. “Growth momentum in India will continue, supported by sustained government spending and policy measures that underpin national infrastructure programs, urban housing and the development of industrial corridors,” said Fitch Ratings. The WSA likewise expects a positive outcome. “Our projections suggest Indian steel demand will continue to charge ahead with around 9% growth in its steel demand over 2025 and 2026, driven by continued growth in all steel-using sectors. In 2026, steel demand in India is projected to be almost 75 Mm/t higher than in 2020,” the SRO said.

Of course, if President Trump does not cause any geo-political disasters, and if the global economy travels along the gently upward trajectory that is predicted, then the steel industry should follow suit.

To news elsewhere – but still focussing on how the future might look – Baosteel Zhanjiang Iron and Steel has announced it has commissioned China’s first million-tonne near-zero-carbon steel production facility at its Zhanjiang plant in China’s Guangdong province. According to the company, the facility began commercial production in late-December and has a rated capacity of 1.8 Mm/t per year of zero-carbon materials. For the steel industry worldwide, the production of lower-emissions steel is one of the most sought after and costly objectives of 2026 and beyond.

Baosteel Zhanjiang is a subsidiary of China Baowu Steel Group, which is the world´s largest steel producer and is a state-owned enterprise controlled by the Chinese government. The Zhanjiang facility incorporates China Baowu’s hydrogen metallurgy and electric smelting process technology and marks the realization of a fully-integrated, short-processed production route for high-grade flat steel products with zero-carbon emissions, the company told the international media. It integrates China’s first million-tonne hydrogen-based shaft furnace with a newly built electric arc furnace and continuous casting facilities. The hydrogen-based shaft furnace uses hydrogen instead of carbon as the reducing agent for smelting, greatly easing reliance on traditional fossil fuels. The high hydrogen smelting environment has now been successfully validated, the company claims, with the direct reduced iron (DRI) produced achieving the targeted metallization rate.

After commissioning, the line will use hydrogen-based DRI and scrap steel as raw materials to produce low-carbon emission slabs, which will be rolled further into low- and near-zero-carbon steel products. “The project serves as a model for the low-carbon transition of steel enterprises and greatly contributes to the high-quality development of the steel industry,” said Wang Hongwu, the company’s steelmaking project leader in the media release.