China's steel demand is expected to see a slight decline of 1% or so in 2026, continuing a downward trend observed in the country's steel consumption over recent years, according to latest research from Metallurgical Industry Planning and Research Institute (MIPRI).

Several key factors contributed to this forecast. First, the slowdown in China's construction sector, traditionally a major driver of steel demand, is expected to lead to lower overall consumption.

This is further exacerbated by the ongoing transition toward greener, more sustainable energy and construction practices, which reduces the demand for traditional steel products.

At the industry conference held by MIPRI on December 19, the Institute predicted that China's steel consumption will be 815 million tonnes in 2025, using consumption coefficient method, with a small decline to approximately 813 million tonnes in 2026.

In addition, using the downstream consumption-based forecasting method, steel consumption for 2025 is projected to drop by 5.9% year on year to 804 million tonnes, with the construction industry seeing a sharp 12.9% fall to 400 million tonnes. In 2026, steel demand is expected to fall to 791 million tonnes, a further 1.7% decrease.

The downstream consumption-based forecasting method also indicates that growth in steel demand in sectors such as automobiles, shipbuilding, household appliances, and bicycles, while demand from industries like construction, containers, and hardware products will see a decline.

Considering the characteristics and limitations of both forecasting methods, a weighted average of the results has been applied to refine the predictions. For 2025, China's steel consumption is projected to be 808 million tonnes, a 5.4% decrease from the previous year. For 2026, it is expected to reach 800 million tonnes, marking a 1.0% year-on-year decline.

Additionally, based on the Institute's analysis of global and regional economic development and steel demand, the forecast indicated that global steel consumption will be 1.72 billion tonnes in 2025, down 1.8% from the previous year, and the figure is expected to rise by 1.0% to 1.74 billion tonnes.

Asia, despite a slight decrease in its share of global steel consumption, remains the largest consumer region. It is projected that Asia will consume 1.19 billion tonnes of steel in 2025, a 2.4% year-on-year decline, accounting for 69.47% of global consumption.

In 2026, steel demand in Asia is expected to grow by 0.3% to 1.2 billion tonnes, maintaining a 69.02% global share.

Europe follows as the second-largest consumer region, with an expected steel consumption of 183 million tonnes in 2025, down 0.5% year on year, representing 10.65% of global consumption. In 2026, Europe's steel demand is forecast to rise by 2.7% to 188 million tonnes, accounting for 10.83% of the global market.

North America is the third-largest region, with projected steel consumption of 133 million tonnes in 2025, a 1.1% decline from the previous year, and a 7.74% global share. In 2026, steel demand is expected to increase 2.3% to 136 million tonnes, rising to a 7.84% global share.