Posted on 14 Oct 2026
The World Steel Association (WSA) has further lowered its forecast for global steel demand in 2026, citing a deeper-than-expected contraction in demand from China, where persistent weakness in the property sector and sluggish infrastructure investment have continued to weigh on steel consumption, according to the association's latest Short Range Outlook (SRO) released on Monday.
Global steel demand is expected to be largely flat at 1.722 billion tonnes in 2026, as compared with the association's April forecast for a slight on-year growth of 0.3%. The growth projection for 2027 is revised down to 1.7% from the previous 2.2%, with total demand forecast to reach 1.752 billion tonnes next year, per the release.
"Almost the whole of that revision is a China story," said Alfonso Hidalgo de Calcerrada, chair of the WSA's Economics Committee, adding that "the recovery we described in April is not weaker; its momentum is being masked by the scale of China's structural contraction and compounded by energy-market disruptions stemming from ongoing instability in the Middle East."
The association now expects Chinese steel demand to decline by 2% in 2026, a steeper contraction than the 1.5% drop forecast in April. It also projects demand to fall by a further 1% in 2027, reversing its previous forecast of no change.
The downward revision reflects the continued slump in China's property market, where the downturn has not eased as quickly as the WSA had expected. Infrastructure investment has also remained in negative territory, failing to uphold steel consumption, WSA pointed out. Meanwhile, export-driven growth in manufacturing-related steel demand has been insufficient to offset the weakness in the property and infrastructure sectors, it added.
Looking ahead, the WSA expects China's property downturn to decelerate next year, but it will remain a drag on steel demand, while the government may remain cautious about expanding infrastructure investment. Manufacturing is expected to maintain moderate growth in 2027, provided exports hold up, although rising trade frictions could pose a significant downside risk to the outlook.
Outside China, the WSA forecasts steel demand will grow 1.5% in 2026 and accelerate to 4% in 2027, a rate rarely seen in recent times. The association attributed the expected recovery to a broad-based improvement in industrial activity across developed economies, alongside continued growth in developing markets.
India, the world's second-largest steelmaking country, is expected to remain a major growth driver, with steel demand forecast to rise by 7.9% in 2026 to 172.4 million tonnes and by a further 8% in 2027 to 186.2 million tonnes. Infrastructure-led construction, robust private real estate activity and continued expansion in manufacturing capacity are expected to support consumption.
In contrast, the Middle East remains a key source of uncertainty. The WSA expects steel demand in the Gulf Cooperation Council (GCC) countries to shrink by around 11% in 2026 because of the ongoing regional conflict. Demand is forecast to rebound by 11.3% in 2027 as deferred projects resume, provided improving security conditions and normalizing supply chains.
For developed economies as a whole, steel demand is projected to grow by 1% in 2026 and 2.2% in 2027. However, the WSA cautioned that the recovery remains modest in historical terms, with demand in the developed world still well below its pre-downturn levels.
The latest outlook therefore points to a gradual recovery in global steel demand, with stronger growth outside China expected to partly offset the continued contraction in the world's largest steel-consuming market.
Source:Mysteel Global
