European steel production hits historic low as imports gain record share of EU market

According to the latest economic report from the European Steel Association (EUROFER), Europe’s steel market is estimated to have shown signs of growth. However, it also highlights how the sector’s outlook is clouded by imports having gained a record share of the EU market, falling European production, volatile energy prices and rising trade tensions.

EU crude steel output falling to a historic low

The report highlights that persistently weak demand has forced the European steel industry to reduce production and restructure capacity, with EU crude steel output falling to a historic low of around 125.8 million tonnes in 2025, compared with 130 million tonnes in 2024.

EU apparent steel consumption - steel demand - is estimated to grow by +2.4% in 2025 and by 1.3% in 2026. However, the increase largely reflects a comparison with exceptionally low demand in previous years, rather than a demand-driven recovery. Even with the projected rebound, European steel consumption will remain well below pre-pandemic levels, by around 11 million tonnes in 2026 and 9 million tonnes in 2027.

Steel imports to the EU see record highs

Import pressure on the EU market also continues to intensify. Steel imports, including semis, rose by +14% in 2025, with finished product imports increasing by +9%, pushing the share of imports in EU steel consumption to a record 29% in the third quarter of 2025.

As a result, the EU’s steel trade balance deteriorated significantly, with the trade deficit widening to around 2 million tonnes per month, including 1.2 million tonnes of finished products.

Axel Eggert, Director-General of EUROFER, said: “Europe’s steel production is shrinking while imports as a share of the EU market are rising. EU policymakers must therefore agree the new steel trade measure quickly without it being weakened otherwise Europe risks losing more industrial capacity. The Iran crisis also shows how exposed European industry remains to global energy shocks. If the EU wants to keep steel production and green investment here, it must deliver both effective trade defence and affordable electricity.’’

War in Iran causes volatile energy prices

Energy markets remain another source of uncertainty. Following the outbreak of the war in Iran, volatility has increased and the benchmark TTF gas price exceeded €50/MWh in March 2026, adding further pressure on industrial competitiveness and investment conditions across Europe’s manufacturing value chains.

Steel-using energy sectors see slight improvements

Industrial activity in steel-using sectors has shown tentative signs of improvement. The Steel Weighted Industrial Production (SWIP) index increased by +1.8% in the third quarter of 2025, after six consecutive quarters of decline. However, the broader outlook remains subdued. SWIP is expected to decline slightly in 2025 (-0.3%) after a sharp contraction in 2024 (-3.6%), before recovering moderately in 2026 (+1.9%) and 2027 (+2.2%). While construction output is beginning to recover, sectors such as automotive and mechanical engineering remain under pressure from weak global demand and trade uncertainty.