Europe’s steel market remains under significant pressure, with exports falling sharply, production at historic lows and demand expected to remain almost flat in 2026, according to the European Steel Association’s (EUROFER) latest Economic and Steel Market Outlook 2026-2027. EU steel exports to third countries fell by 20% in the first half of 2026, with declines across all major export destinations covered by the report. At the same time, crude steel production continued to falter, after reaching a historic low of 125.8 million tonnes in 2025, while apparent steel consumption is forecast to grow by just 0.1% in 2026, before increasing by 2.3% in 2027.
Axel Eggert, EUROFER’S Director-General remarked, “The 20% fall in exports is an alarming signal of the pressure facing European steel. Combined with production at historic lows and persistently high energy costs, it shows that Europe’s industrial recovery is far from secured. The new EU steel trade measure is an essential first step. Now we need to build on that progress with an industrial recovery that works across regions and across the value chain, bringing back production, investment and quality jobs in Europe.”
Steel production remains at historic lows
EU crude steel production fell by 2.9% to a record low of 125.8 million tonnes in 2025 and declined by a further 1% in the first five months of 2026 (+1.1% in May 2026). Capacity utilisation improved slightly to 67% from 65% in 2025, but remains low in historical terms.
Steel exports fall sharply
EU steel exports to third countries fell by 20% in the first six months of 2026. Exports declined across major international markets, including the United States (-29%), India (-24%), Turkey (-21%) and China (-18%). Despite a decline in imports over the same period, the EU remains a significant net importer of steel.
Steel demand loses momentum
Apparent steel consumption increased by 1.5% in the first quarter of 2026, but the recovery is expected to lose momentum. Growth is forecast at just 0.1% for the year. A more meaningful improvement is expected in 2027, when demand is forecast to grow by 2.3%, with consumption remaining around 7 million tonnes below 2019 levels.
Industrial demand recovers only modestly
Output in steel-using sectors is forecast to grow by 1.5% in 2026, following two years of decline. The recovery remains uneven: construction and mechanical engineering are expected to support growth, while automotive output is forecast to fall by a further 0.9%. A broader recovery is not expected before 2027.
Energy and global uncertainty continue to weigh on industry
Energy costs have risen sharply during 2026, adding further pressure on Europe’s energy-intensive industries. European gas prices have fluctuated around €50/MWh, reaching peaks of around €80/MWh in recent weeks - 132% higher than at the start of the year. The renewed increase in energy prices is weighing on industrial competitiveness at a time when manufacturing activity remains fragile.
.png)
