OECD: Global steel demand recovery to remain weak as overcapacity crisis deepens

The Organization for Economic Cooperation and Development (OECD) said in its Steel Outlook 2026 report that global steel demand is expected to recover only slightly in 2026 after four consecutive years of decline, as the continued slowdown in China's real estate sector offsets stronger growth in India, Southeast Asia In Africa and some markets in the Middle East, while the widening gap between steel capacity and demand continues to exacerbate the structural crisis facing the global steel industry. industry.

According to the OECD, global steel demand declined by about 2.6 percent in 2025 to 1.80 billion tons and is projected to grow by just 0.4 percent in 2026 to 1.81 billion tons, while demand is expected to reach 1.88 billion tons by 2030, matching the cumulative annual rate. growth of only 0.9 percent during 2030. The period 2025-30

The OECD noted that steel demand in China fell by 6.9 percent in 2025 to 830.94 million tons and is expected to decline by another 0.6 percent in 2026 to 826.22 million tons, as construction activity in The country remains sluggish, despite the government's decision in January 2026 to abandon the three-red borrowing policy, which previously limited developers' access to financing.

The organization said the policy change is unlikely to lead to a rapid recovery in steel consumption, as buyer confidence remains weak and new home prices are still falling, while steel demand in China is expected to continue its long-term decline and fall to 817.84 million tons by 2030.

Global overcapacity is projected to reach 745 million tons by 2028

The OECD stated that The weakness in demand comes as global steel capacity continues to expand, creating a growing imbalance that is expected to keep capacity utilization rates at unsustainable levels and increase financial pressure on producers.

According to the report, global excess steel production capacity is estimated to reach 640 million tons in 2025 and is projected to grow to 745 million tons by 2028, as demand is expected to increase by only 34 million tons between 2026-2028, while capacity may increase to 139 millions of tons over the same period.

The OECD stressed that, if implemented, global excess