From Steel Oversupply Crisis to Low-Carbon Opportunities: Insight Report 2026–2027 — Global & Thailand Steel Industry Turning Point Toward Sustainability | SO OK TRADING | September 26, 2026
**Global & Thailand Steel Industry Outlook 2026–2027
From Oversupply Crisis to Green Steel Transition** Article by SO OK TRADING | September 26, 2026
Introduction
The global steel industry is facing its most significant challenge in a decade. Oversupply pressures (Global Oversupply), sluggish demand recovery, and China’s continued massive steel exports to the global market are driving down prices and intensifying competition worldwide.
Meanwhile, Thailand’s steel industry is under dual pressure: rising production costs and the influx of cheap imported steel. This situation forces Thai producers to make major strategic adjustments to maintain competitiveness.
SO OK TRADING’s analysis of the 2026–2027 outlook highlights “Green Steel” (low-carbon steel) as the key to reshaping both the Thai and global steel industries, enabling a sustainable future and restoring competitiveness in the global market.
Global Steel Industry Situation
Crude Steel Production: In July 2026, global crude steel output stood at 149.2 million tons, down 0.3% year-on-year, reflecting weak demand.
Excess Capacity: OECD reports worsening overcapacity, suppressing market recovery.
China’s Role: China continues to export massive volumes of steel, putting downward pressure on prices across regions.
Thailand Steel Industry Situation
Margin Squeeze: Thai producers face profit pressure from cheap imports and rising costs.
Chinese Dumping: Imported steel now accounts for 70% of domestic consumption.
Uncertified Pre-Fabricated Steel: Rising imports of unregulated steel pose safety and competition risks.
Domestic Production Decline: Demand is 18.8 million tons, but domestic production is only 8.1 million tons.
Fourfold Cost Burden: Global energy prices, freight rates, domestic logistics, and electricity costs continue to rise.
Outlook and Future Directions
Global
Slow Demand Growth: Average annual growth projected at only 0.9% until 2030.
Excess Capacity: Expected to reach 745 million tons by 2028.
India Rising: Steel demand projected to grow 7.4% in 2026 and 9.2% in 2027.
Green Steel: Forecast to account for 25% of the global flat steel market by 2040.
Thailand
Limited Recovery: Demand growth projected at 1.0–1.6%, totaling 18.7–18.9 million tons annually.
Construction Sector: Long steel demand supported by government projects and EEC expansion.
Automotive & EV Sector: Rising demand for high-strength steel and premium cold-rolled steel.
Appliances & Food Industry: Growing demand for stainless steel and coated steel.
Constraints: Weak domestic purchasing power, production utilization below 30%, import dependency at 60–70%.
Green Steel Transition: Adoption of Electric Arc Furnaces (EAF) and scrap recycling.
Steel Scrap Market Outlook
Current Prices: East Asia ~$418/ton; Turkey HMS 1&2 at $350–380/ton.
Upside Drivers: EAF expansion, export restrictions, high energy costs.
Downside Risks: China’s property slowdown, cheap finished steel exports, falling iron ore prices.
Overall Trend: Stable in the short term, gradual recovery with premium potential in the long term.
Conclusion
The global and Thai steel industries are at a critical turning point. In the short term, oversupply and rising costs remain major challenges. However, in the long term, the transition to Green Steel and the strategic use of scrap steel will be the key drivers of competitiveness. Thai producers must manage price risks and adopt new technologies to remain resilient in the global market.
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