CARBON STEEL MARKET ANALYSIS

Global carbon steel market size was valued at US$ 1,002.81 billion in 2023 and is expected to reach US$ 1,284.51 billion by 2030, exhibiting a compounded annual growth rate (CAGR) of 3.6% during the forecast period (2023-2030). Carbon steel is a type of steel that contains carbon as its main alloying element. It is a versatile material that is used in a wide variety of applications including constructions, infrastructures, automotive, and manufacturing.

Carbon steel is one of the most widely used materials in the world. It is an alloy which is primarily made up of iron and carbon. The composition and processing can vary, which leads it to different grades and characteristics.

Carbon Steel Market Regional Insights

• Asia Pacific is the largest market for carbon steel, which accounted for over 40% of the global market in 2022. The region is expected to continue to dominate the market during the forecast period, due to the growth of the construction, automotive, and shipbuilding industries. China is the largest market for carbon steel in the Asia Pacific region, which is followed by India and Japan.
• North America is the second largest market for carbon steel, which accounted for over 20% of the global market in 2022. The market is expected to grow at a CAGR of 4.5% during the forecast period, due to the growth of the automotive, construction, and manufacturing industries. The U.S.is the largest market for carbon steel in North America, which is followed by Canada and Mexico.
• Europe is the third largest market for carbon steel, which accounted for over 15% of the global market in 2022. The market is expected to grow at a CAGR of 3.5% during the forecast period, due to the growth of the automotive, construction, and machinery industries. Germany is the largest market for carbon steel in Europe, followed by Italy and France.

Figure 1. Global Carbon Steel Market Share (%), By Region, 2023

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Global Carbon Steel Market Drivers

• Infrastructure Development: With rapid development in countries, they invest heavily in infrastructural projects such as bridges, buildings, and roads. For instance, India wants to develop 100 smart cities which is increasing the demand for carbon steel for urban infrastructure, which includes buildings, transportation, and utilities. Carbon steel is widely used in these applications due to its durability and strength. The global infrastructure hub estimates that US$94 trillion in infrastructure investment is needed by the end of 2040 to meet global demand, which indicates a substantial market for carbon steel.
• Automotive Industry: Carbon steel is also extensively used in the automotive industry for car bodies, chassis, engine components, and more. Growth in the automotive sector directly impacts the demand for carbon steel. For instance, according to Bergsen Metal Company, steels with high carbon content are alloys that have undergone the quenching heat treatment method. They are less ductile and brittle than ordinary steel but have higher wear and tear resistance. Automakers choose high-carbon steel for vehicle frames, chassis, bushings, door panels, support beams, mufflers, and other components.
• Rapid Urbanization: The migration of people from rural areas to urban cities requires the construction of housing and other amenities. This is expected to drive the demand for steel in the construction sector.
• Energy Sector: The energy industry, including oil and gas, requires pipelines, rigs, and other infrastructure, majority of which is made with the use of carbon steel.

Global Carbon Steel Market Opportunities

• Green Steel Production: With environmental concerns gaining prominence, there is a push for more sustainable steel production methods. There is opportunities for producing carbon steel with the use of methods that would emit fewer greenhouse gases or even adopting technologies that would capture and utilize the emitted carbon dioxide (CO2).
• High-Strength, Low-Alloy Steels: The demand for high-strength, low-alloy (HSLA) steels is increasing, especially in sectors like automotive, where lightweight and strong materials can enhance fuel efficiency. For instance, according to, Docol Company is an automotive steel company. HSLA steels provide a straightforward way to increase the strength of automotive components and thereby reduce their weight. Weldability is good due to lean alloy composition and bendability is also excellent.
• Developing Markets: Emerging economies in Africa, South Asia, and parts of Latin America are still undergoing significant infrastructure development. These regions provide ample opportunities for carbon steel sales and infrastructure projects.
• Value-added Products: There is an increasing demand for value-added steel products with specific features like corrosion resistance, high tensile strength, or specific finishes. Manufacturers who can provide these differentiated products are able to command premium prices.

Global Carbon Steel Market

• Sustainability and Emission Reduction: The global push for sustainability made reducing carbon emissions in steel production a priority. For instance, according to , cutting-edge technology is used to work and reduce the emissions by creating green steel in a completely integrated production process, by use of end-to-end digitalization, power from fossil-free sources, and green hydrogen in place of coal. Innovations in green steel production methods, such as hydrogen-based steelmaking, are also trending.
• Digitalization of the Supply Chain: The integration of Industry 4.0 technologies, like IoT, AI, and big data analytics is optimizing production, enhancing predictive maintenance, and improving overall supply chain management.
• E-commerce Penetration: Direct online sales of steel products to both B2B and B2C segments are increasing. Digital platforms help in simpliying the buying process and offer insights into customer behavior and demand patterns. For instance, in 2021, according to Mill Steel Co., carbon steel products are available on e-commerce website. The website features 65,000+ tons of steel that is available for purchase with full physical and chemical certification provided for each coil.
• Value-added Products: There is a growing trend towards producing and offering carbon steel products with additional value, such as coatings that resist corrosion, or treatments that enhance durability.

Global Carbon Steel Market Restraints

• Environmental Concerns: Steel production, particularly in blast furnaces, results in substantial CO2 emissions. As global emphasis on sustainability grows, there is increased pressure on the industry to adopt greener production methods, which can sometimes be cost-intensive. For instance, around 6% of the total CO2 emissions worldwide are caused by the manufacture of steel. By implementing more effective processes and systems, the steel industry has decreased the energy that is needed to produce a ton of steel by more than 60%
• Competition from Alternatives: Materials like aluminum, composites, and stainless steel sometimes offer advantages over carbon steel in specific applications. For example, the automotive industry is increasingly considering aluminum to reduce vehicle weight and improve fuel efficiency.
• Volatility in Raw Material Prices: The cost of iron ore and coking coal, the primary raw materials for carbon steel production, can be highly volatile. Fluctuations can affect production costs and profit margins.
• Overcapacity: In certain regions, there's a significant overcapacity in steel production, leading to reduced prices, which can strain profitability for producers.
• Counterbalance: The key market players should focus on manufacturing products which are environment friendly and cause no harm to the environment.

Analyst’s View on Global Carbon Steel Market

The global carbon steel market is expected to witness steady growth over the next five years. The construction industry will continue being the major driver of demand for carbon steel as properties and infrastructure develop across developing nations. Recovery in the automotive and machinery manufacturing sectors following the pandemic declines will also support carbon steel consumption. However, sustainability regulations pushing for reduced carbon emissions and adoption of green steel alternatives could restrain the volume growth. The market will also face challenges from rising raw material costs and global supply chain disruptions. On the bright side, government infrastructure expenditure earmarked for improving road and rail networks presents opportunities for volume gains. Asia Pacific has emerged as the dominant region in the carbon steel market and will maintain its lead position. Continued urbanization and investment in building projects across China, India, and Southeast Asia will benefit the steel producers. North America's market is expected to grow at a moderate pace on the back of spending approved under various infrastructure development plans. The revival of the construction and automotive industries post-pandemic will drive steel demand higher in the region. Over the medium term, the ability of market players to innovate production processes to reduce carbon footprint and transition to more sustainable practices will determine their competitiveness. Adapting to changing environmental regulations and consumer preference for greener materials are challenges steelmakers must address to unlock new growth avenues.

Recent Developments

New product launches

• launched Greenate certified steel in South Korea. This low-carbon steel product is made using a variety of technologies to reduce CO2 emissions, including the use of scrap metal, hydrogen-based directly-reduced iron, and electric arc furnaces. POSCO aims to have an annual production capacity of 5Mt of Greenate certified steel by 2030.
• Hyundai Steel launched HyECOsteel, its own low-carbon steel brand. The company plans to have an annual production capacity of 5Mt of HyECOsteel by 2030. HyECOsteel is made using a variety of technologies to reduce CO2 emissions, including the use of scrap metal, molten iron from blast furnaces, and hydrogen-based directly-reduced iron.
• JFE Eco Xcel, a new brand of high-strength, low-alloy steel. JFE Eco Xcel is made using a new production process that reduces CO2 emissions by up to 20% compared to traditional steelmaking methods. JFE Steel aims to have an annual production capacity of 1Mt of JFE Eco Xcel by 2025.               

Acquisition and partnerships

• In 2022, ArcelorMittal acquired Cleveland-Cliffs for US$38 billion. This deal created the world's largest steelmaker by output.
• In 2021, Nippon Steel and Sumitomo Metal Corporation (NSSMC) announced plans to merge. The combined company would be the world's second-largest steelmaker.
• In 2020, China Baowu Steel Group acquired the assets of the Australian steelmaker BlueScope Steel for US$5.4 billion. This deal gave China Baowu a major foothold in the global carbon steel market.

Figure 2. Global Carbon Steel Market Share (%), By Treatment, 2023

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Top companies in Carbon Steel Market

• Nippon Steel & Sumitomo Metal Corporation (NSSMC)
• POSCO
• Tata Steel
• Baowu Group (China Baowu Steel Group Corp.)
• JFE Steel Corporation
• JSW Steel
• United States Steel Corporation (U.S. Steel)
• Shagang Group
• Ansteel Group

*Definition: The carbon steel market refers to the global industry and commerce surrounding the production, distribution, and consumption of steel with a main alloying element of carbon, utilized in a wide range of applications such as construction, automotive, machinery, and infrastructure.