EU steel recovery stalls as exports fall sharply and production remains under pressure

While the wider EU economy has shown resilience, this has yet to translate into a meaningful recovery for the European steel industry. Steel demand is expected to remain almost flat in 2026, production has modestly improved (+1.1% in May 2026) after reaching a historic low in 2025, and exports have fallen sharply across major international markets.

Apparent steel consumption increased by 1.5% in Q1 2026, following stronger than expected growth of 4.5% in 2025, which was supported by exceptional factors including a sharp increase in imports in the second half of the year. However, the recovery is expected to lose momentum, with apparent steel consumption forecast to grow by just 0.1% in 2026 and by +2.3% in 2027. Even then, consumption volumes are expected to remain around 7 million tonnes below 2019 levels.

EU crude steel production fell to a record low of 125.8 million tonnes in 2025 (-2.9%) and increased by +1.1% in May 2026. Capacity utilisation increased slightly to 67%, from 65% in 2025, but remains low in historical terms.

Trade developments also point to growing pressure on EU steel producers. EU steel exports to third countries fell by 20% (14 million tonnes) in the first half of 2026, with exports declining across all major destinations covered in the report. Total imports declined by 5% (total imports: 34 million tonnes; finished products: 26 million tonnes) over the same period, following the exceptional surge at the end of 2025, while the EU remained a significant net importer of steel. 

Demand from steel-using sectors (SWIP) is forecast to recover by 1.5% in 2026, following a marginal decline of -0.1% in 2025. Growth remains uneven, with construction and mechanical engineering supporting demand while automotive output is forecast to decline by a further -0.9% in 2026. A broader recovery is expected in 2027, when SWIP is forecast to grow by 2.5%