During a panel titled "The Global Steel Industry Outlook: Risks, Opportunities and Strategic Priorities" at the 19th Arab Steel Summit, held in Cairo, Egypt, on November 3-4, industry experts discussed the challenges facing the global steel sector, including excess production capacity, increasing protectionism, rising costs and geopolitical tensions. The speakers also highlighted emerging growth opportunities, particularly in India and the Middle East, and emphasized the growing importance of cost competitiveness and decarbonization.
Global overcapacity and protectionism remain major concerns
Dr. Alia El-Mahdy, former dean of the Faculty of Economics and Political Science at Cairo University, highlighted the increasing use of trade restrictions, including safeguard measures, antidumping duties and environmental regulations such as the EU's Carbon Border Adjustment Mechanism (CBAM). She noted that global steel overcapacity remains a structural challenge, with the average capacity utilization rate among the world's ten largest steel-producing countries standing at approximately 70.7 percent in 2025.
El-Mahdy also emphasized the impact of rising energy and raw material costs on steel producers. Nevertheless, she identified opportunities in low-emission steel production, product diversification and digitalization, stressing the importance of improving capacity utilization and investing in advanced manufacturing technologies.
Dr. Veysel Yayan, secretary general of the Turkish Steel Producers Association, drew attention to the impact of China's rapid production expansion and increasing global protectionism on international steel trade. He criticized US tariffs and the EU's restrictive import quotas, noting that Turkey's steel exports to the EU had declined from approximately 7 million mt to 2.8 million mt. Yayan warned that China's excess capacity continues to create imbalances in global markets and called for stronger international cooperation and a rules-based trading system to ensure fair competition.
India and GCC expected to drive future steel demand growth
Mohamed Aljabr, consultant and expert in the iron and steel sector, highlighted India and the Gulf Cooperation Council (GCC) countries as important growth markets. Referring to the worldsteel's October 2026 short-range outlook, he noted that Indian steel demand is expected to increase by 7.9 percent in 2026 and 8 percent in 2027, supported by infrastructure investments and industrial development.
Regarding the GCC, Aljabr stated that steel demand is expected to decline by approximately 11 percent in 2026 due to disruptions caused by regional geopolitical tensions, following strong growth in 2025. However, he emphasized that many investment projects have been postponed rather than canceled, with demand forecast to rebound by 11.3 percent in 2027 as regional conditions improve.
Sunil Seepana, senior analyst at CRU, similarly identified India and Southeast Asia as the main drivers of global steel demand growth through 2031. In contrast, Chinese steel demand is forecast to decline from approximately 927 million mt in 2026 to 875 million mt in 2031, primarily due to continued weakness in the construction sector. He added that growing trade barriers and expanding production capacity in importing countries are expected to restrict Chinese steel exports in the coming years.
Cost and emissions competitiveness to become increasingly important
Seepana also highlighted the growing importance of energy costs and carbon emissions in determining steel producers' competitiveness. According to CRU's analysis, a 50 percent increase in energy costs will raise production costs, with electric arc furnace-based producers particularly exposed to energy price fluctuations. He noted that Middle Eastern and North African steel producers benefit from relatively low emissions intensity due to their reliance on natural gas-based production. However, increasing investments in cleaner technologies by Chinese producers could intensify competition in low-emission steel markets.
The panel highlighted that while emerging markets offer opportunities for demand growth, increasing trade restrictions, energy costs and decarbonization requirements will continue to reshape global steel trade, making market access, production efficiency and cost competitiveness critical priorities for steel producers.
