OECD Warns Steel Overcapacity Will Hit 745 Million Tons by 2028 as China Exports 131 Million
Updated
Updated · Euronews · Jun 4
OECD Warns Steel Overcapacity Will Hit 745 Million Tons by 2028 as China Exports 131 Million
3 articles · Updated · Euronews · Jun 4
Summary
745 million tons of global steel overcapacity is projected for 2028, up from 640 million in 2025, as capacity growth keeps far outpacing weak demand, the OECD said.
139 million tons of new steelmaking capacity are planned for 2026-2028 against just 34 million tons of demand growth; China alone accounts for up to 38.6 million tons of the expansion.
131 million tons of Chinese steel exports in 2025 — a record and 153% above 2020 — added to pressure on OECD producers, with median Chinese firms receiving subsidies equal to 15 times peers' levels relative to assets.
A 300% jump in Chinese semi-finished steel exports to Southeast Asia suggests some shipments may be routed there for processing before re-export to OECD markets, potentially skirting tariffs and anti-dumping duties.
Europe faces the sharpest strain as energy can make up 40% of steel costs, the Iran war has lifted power prices, and 42 countries now restrict steel scrap exports, tightening raw-material supply.