The End of China’s Steel Domination — and What Comes Next
Goldman Sachs says China’s grip on global steel is cracking. Production has peaked. Now, the supply shock might swing west.
May 27, 2025
Two decades of China's steel supremacy may finally be unraveling.
Goldman Sachs now says what few dared to declare out loud:➤ China’s global steel expansion is structurally finished.
➤ 2025 output has already peaked.
➤ Export barriers and slowing domestic demand are pulling the brakes.
According to Goldman’s latest global metals outlook, China’s share of global steel production has declined for the first time in over 20 years — a turning point that could reset global pricing dynamics, supply chains, and policy strategy across the industrial world.
Key Takeaways:
China’s steel output peaked in March 2025 and is projected to fall 2–3% YoY going forward.
Domestic demand continues to slide, especially in property and construction.
Finished and semi-finished steel exports are forecast to drop 33% by 2026, from 12% of ex-China consumption to just 8%.
The property sector drag, ongoing export headwinds, and state-imposed production caps are squeezing supply from every angle.
What’s Driving the Reversal?
🏠 Construction downturn — new housing starts forecasted to drop to 24% of demand in 2025.
🌍 Protectionist measures — trade friction and anti-dumping policies are starting to work.
🧯 Policy risk — emissions and output caps could hit Q4 2025 production further.
💸 Weak domestic growth — China's stimulus hasn't reignited internal consumption.
What Comes Next?
Goldman forecasts a shift toward ex-China steel production:
+3% YoY in 2025
+8% YoY in 2026
The winners?
🇮🇳 India (nearshoring growth)
🇺🇸 United States (onshoring under ‘America First’)
🇪🇺 EU (backed by Green Steel subsidies)
Global Price Outlook:
Near-term pain: weak demand, high inventories
But 2026 could be a rebound year for Western steel, as Chinese output fades and global demand stabilizes.