The European Steel Industry: An Overview
To provide context, introducing the European steel industry as a significant contributor to global steel production can help readers understand its impact. Key points to cover:
- The EU is one of the largest steel-producing regions, contributing approximately 11% of global crude steel production.
- The industry supports over 330,000 direct jobs and over 2.6 million indirect jobs across the supply chain.
- Major steel-consuming industries in Europe include construction (35%), automotive (18%), and mechanical engineering (14%).
Key Players in the European Steel Market
Discussing the leading steel manufacturers in Europe will help paint a clearer picture of the industry landscape. The top companies include:
- ArcelorMittal (Luxembourg) – The largest steel producer in Europe, with operations in more than 60 countries.
- Thyssenkrupp (Germany) – A major player specializing in automotive steel and industrial engineering.
- Tata Steel Europe (UK & Netherlands) – One of the top producers, known for high-quality steel solutions.
- SSAB (Sweden) – A leader in high-strength steel and sustainability efforts.
- Voestalpine (Austria) – A key supplier of advanced steel solutions, especially for automotive and rail industries.
Global Iron Ore Exports in 2024
In 2024, global iron ore exports reached approximately 1.6 billion tons, reflecting the robust demand for this critical raw material in steel production. Major iron ore-producing countries, including Australia, Brazil, and India, continued to dominate the export market. Australia maintained its position as the leading exporter, leveraging its vast reserves and efficient mining operations to supply key markets, particularly in Asia.
Brazil, recovering from previous disruptions, increased its export volumes, contributing significantly to the global supply chain. India also expanded its presence in the international market, capitalizing on rising demand and favorable trade policies.
The sustained high level of iron ore exports underscores the material’s pivotal role in global steel production. As countries invest in infrastructure and industrial development, the demand for steel—and consequently iron ore—remains strong. However, this growth also brings attention to environmental concerns associated with mining and transportation, prompting discussions on sustainable practices within the industry.
Global Iron Ore Exports: A 1.6 Billion Ton Market
Iron ore is the backbone of the steel industry, and in 2024, global exports grew by 2% year-on-year (y/y), reaching 1.6 billion tons, compared to 1.57 billion tons in 2023. However, this growth was slower than the 5% increase seen in 2023, signaling a more moderate expansion phase.
Key Suppliers of Iron Ore
Australia continues to dominate the iron ore export market, supplying more than half of the global volume:
- Australia: 866 million tons (+1.4% y/y)
- Brazil: 390 million tons (+2.6% y/y)
- South Africa: 61 million tons (+3.4% y/y)
- India: 38 million tons (-14% y/y)
China: The Driving Force Behind Iron Ore Demand
China remains the largest importer of iron ore, increasing its imports by 5% y/y to 1.237 billion tons in 2024. Several factors contributed to this increase:
- Macroeconomic stimulus measures in construction and manufacturing
- The US Federal Reserve’s interest rate cuts, which improved global market conditions
- Relatively stable steel production at 1.005 billion tons (-1.7% y/y)
- Iron ore stockpiling at Chinese ports, reaching 143 million tons (+16% y/y)
Major Iron Ore Producers and Market Outlook
Leading global mining companies ramped up production in response to demand:
- BHP (Australia): 290 million tons (+3% y/y)
- Rio Tinto (Australia): 290 million tons (+4% y/y)
- Fortescue Metals Group (Australia): 194 million tons (+2% y/y)
- Vale (Brazil): 328 million tons (+2% y/y, highest since 2018)
- India: 284 million tons (+2% y/y)
The World Steel Association forecasts a 1.2% growth in global steel demand in 2025, which could further boost iron ore production and exports. Vale has increased its 2025 production target to 325-335 million tons, while India’s output is expected to reach 305-310 million tons, driven by rising domestic consumption.
The Role of Direct Reduced Iron (DRI) in the EU Steel Market
- What is DRI? Direct Reduced Iron is an alternative to traditional iron ore used in steelmaking, often seen as a greener option.
- Why is the EU Increasing DRI Imports?
- It reduces carbon emissions compared to conventional blast furnace steelmaking.
- The EU’s push toward hydrogen-based steel production has increased demand for high-quality iron feedstock like DRI.
- High energy costs make it more economical for some producers to import DRI rather than use traditional blast furnaces.
The EU’s Growing Dependence on Direct Reduced Iron (DRI)
European steelmakers increased their imports of direct reduced iron (DRI) in 2024 by 5.4% y/y, reaching 2.75 million tons. This growth follows a sharp 11.1% decline in 2023, highlighting a recovery in demand.
Top DRI Importers in the EU (2024)
- Italy: 659.73 thousand tons (-23.7% y/y)
- Netherlands: 527.27 thousand tons (+423%)
- Germany: 438.46 thousand tons (-33.5% y/y)
- Austria: 276.51 thousand tons (+58.4%)
- Spain: 247.07 thousand tons (-1.6%)
- Belgium: 238.62 thousand tons (-7.6%)
- Poland: 202.81 thousand tons (+209.9%)
While the Netherlands and Poland significantly increased imports, major steel producers like Germany and Italy saw a decline, indicating possible shifts in raw material sourcing strategies.
Key DRI Suppliers to the EU
- Russia: 1.04 million tons (-12.2% y/y, still 38% of total EU imports)
- Libya: 475.53 thousand tons (+16.6%)
- United States: 368.63 thousand tons (-6.3%)
- Venezuela: 294.81 thousand tons (+23.8%)
- Canada: 158.42 thousand tons (+16.8%)
The EU’s heavy reliance on Russian DRI remains a challenge, given geopolitical tensions and sanctions policies. However, increased imports from Libya, Venezuela, and Canada suggest potential diversification efforts in the supply chain.
Economic Drivers of Steel Production and Trade in the EU
Several economic factors influence the European steel industry:
- Energy Costs – The EU faces some of the highest energy prices globally, impacting production costs and competitiveness.
- Raw Material Dependence – Europe relies on iron ore imports from Australia, Brazil, and South Africa, making it vulnerable to global price fluctuations.
- Environmental Regulations – The EU Emissions Trading System (EU ETS) imposes strict carbon emission limits on steelmakers, pushing the industry toward greener technologies.
- Infrastructure & Construction Growth – European infrastructure projects, such as Germany’s Autobahn expansion and France’s Grand Paris Express, drive steel demand.
EU’s Steel Exports on the Rise: Long and Flat Products Show Growth
Long Products: 6.4 Million Tons Exported in 2024
Exports of long steel products from the EU grew by 3.6% y/y, reaching 6.36 million tons. This marks the second consecutive year of growth after a 17.4% decline in 2022.
Top Exported Long Steel Products:
- Angles, shapes, and special sections (HS-7216): 2.14 million tons (+0.7% y/y)
- Other carbon steel rods and bars (HS-7214): 1.29 million tons (+8.9% y/y)
- Hot-rolled rods and bars (HS-7213): 1.17 million tons (+3.7% y/y)
The UK was the largest importer, followed by the US, Switzerland, Turkey, Norway, and China.
Flat Products: First Export Growth Since 2019
The EU exported 10.86 million tons of flat steel products in 2024, a 3.9% y/y increase.
Key Flat Product Exports:
- Alloy steel flat products (HS-7225): 3.19 million tons (+8.4% y/y)
- Coated flat products (HS-7210): 2.94 million tons (+13.5% y/y)
- Hot-rolled flat products (HS-7208): 2.44 million tons (-10.5% y/y)
The US was the largest consumer of EU flat steel, importing 1.9 million tons (+31.5% y/y). The UK, Turkey, Switzerland, Egypt, China, and Norway were also major buyers.
Global Steel Demand Outlook and Future Projections
- Global steel demand is expected to grow by 1.2% in 2025, according to the World Steel Association.
- China remains the largest steel consumer, with demand tied to infrastructure projects and real estate development.
- The U.S. and EU markets are stabilizing, but steel demand growth is slower due to economic uncertainties.
- Green steel initiatives are reshaping the industry, with more companies investing in hydrogen-based and low-carbon steel production methods.
Challenges and Opportunities for the Steel Industry
Despite the positive export figures, the European steel industry faces several challenges. A significant concern is the influx of cheap steel imports, particularly from China, which has led to calls for stronger trade protections. European steelmakers have urged the EU to address the surge in Chinese steel exports that have lowered European prices below production costs. Producers and Eurofer, Europe’s main trade body, have called for a new tariff system to counter the market-distorting effects of global overcapacity and protect local manufacturers amid weak demand and high energy costs. The situation threatens the sustainability of Europe’s steel industry and its low-carbon transformation.
Additionally, the industry is navigating the transition toward greener steel production methods. Decarbonizing the steel industry, which accounts for 7%-9% of global carbon emissions, is crucial for meeting climate goals and could be highly profitable. The current steel-making process heavily relies on coal, particularly in converting iron ore into pig iron. However, new technologies can significantly reduce carbon emissions, as low as 300 kg per ton of steel compared to the present 2.2 tons. Transitioning to green iron, primarily using hydrogen from renewable energy sources, requires massive investments in infrastructure and government regulatory support. It also demands commitments from major steel producers to shift to electric arc furnaces and collaborate on setting up green iron plants. Overcoming coordination and investment hurdles among various stakeholders and securing a robust policy framework are essential steps toward realizing the green iron industry’s potential.
- High Energy Costs in the EU:
- EU steelmakers face higher production costs, reducing competitiveness against producers in Turkey and China.
- Geopolitical Instability and Trade Barriers:
- Trade restrictions, including potential US tariffs on EU steel, could impact export strategies.
- Environmental Regulations:
- The EU’s carbon emission policies could affect steel production and increase costs.
However, opportunities exist:
- Economic recovery in key markets (US, UK, Switzerland) will drive demand.
- Diversified sourcing of raw materials (DRI from Venezuela, Canada, Libya) will reduce reliance on Russian imports.
Conclusion
The global iron ore and European steel markets in 2024 have demonstrated resilience and adaptability amid various challenges. The increase in iron ore exports reflects sustained global demand for steel, while the EU’s export growth in flat and long products indicates a recovering steel sector. However, the industry must address challenges related to trade dynamics and environmental sustainability to ensure long-term growth and competitiveness.
The global steel industry saw positive developments in 2024, with iron ore exports reaching 1.6 billion tons, the EU increasing DRI imports by 5.4%, and exports of both long and flat products growing. While geopolitical and economic challenges remain, 2025 is expected to bring further growth, with increased production and exports.
Businesses in the steel sector, including LUX METAL, must stay informed and adapt to market changes to remain competitive. If you need customized stainless steel solutions, visit LUX METAL for top-tier metal fabrication services.
Lux Metal: A Key Partner in the Steel Industry
At Lux Metal, we understand the evolving demands of the steel industry and offer customized metal solutions tailored to businesses worldwide.
Our expertise includes:
- Custom Stainless Steel Fabrication – High-quality steel components for construction, automotive, and industrial applications.
- Precision CNC Machining – Cutting-edge technology to deliver precise, high-strength steel products.
- Laser Cutting and Sheet Bending – Advanced manufacturing techniques for efficient and cost-effective production.
- Sustainable Metal Solutions – Eco-friendly processes to align with the EU’s sustainability goals.
As the steel market evolves, Lux Metal remains committed to innovation and quality, ensuring that businesses receive the best metal solutions for their needs.
For more information, visit our website: Lux Metal Group