India Steel Demand Offsets Chinese Market Decline

The World Steel Association projects that India will remain the fastest-growing major steel market, with demand expected to rise 7.9% to 172.4 million tonnes in 2026 and 8% to 186.2 million tonnes in 2027. This growth, driven by infrastructure, automotive, rail, and private real estate, serves as a critical counterweight to a declining Chinese market. In 2026, India's finished steel demand is forecast to rise by 11.8 million tonnes, nearly offsetting a projected 11.9 million tonne decline in China.

Global steel demand is forecast to remain flat at 1,722 million tonnes in 2026 before growing 1.7% in 2027. While the United States expects 2% growth in 2026 due to energy and data center investments, the European Union is projected to see a 0.3% decline in steel use before recovering by 3.1% in 2027. The Gulf region is forecast for an 11.3% rebound in 2027, contingent on the reopening of the Strait of Hormuz.

Market stability remains fragile because the Chinese market is approximately 4.6 times the size of India's. Data from the National Bureau of Statistics of China indicates continued pressure on the property sector, with new building starts falling 24.8% year-on-year from January to August 2026. This contraction casts doubt on the stabilization of Chinese demand, which is expected to drop 2% in 2026 and 1% in 2027.