CARBON STEEL MARKET ANALYSIS

The global carbon steel market size was valued at US$ 1002.81 Billion in 2023 and is expected to reach US$ 1284.51 Billion by 2030 and is expected to register a revenue CAGR of 3.6% during the forecast period (2023-2030). Carbon steel is a type of steel that contains carbon as its primary alloying element. It is a versatile material that is used in a wide variety of applications, including construction, infrastructure, automotive, and manufacturing.

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

Carbon Steel Market Regional Insights

• Asia-Pacific is the largest market for carbon steel, accounting for over 40% of the global market in 2022. The region is expected to continue to dominate the market during the forecast period, driven by the growth of the construction, automotive, and shipbuilding industries. China is the largest market for carbon steel in the Asia-Pacific region, followed by India and Japan.
• North America is the second largest market for carbon steel, accounting 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, driven by the growth of the automotive, construction, and manufacturing industries. The United States is the largest market for carbon steel in North America, followed by Canada and Mexico.
• Europe is the third largest market for carbon steel, accounting 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, driven by 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

Carbon Steel Market Drivers

• Infrastructure Development: As countries develop, they invest heavily in infrastructure projects such as bridges, Green buildings, and roads. Carbon steel is widely used in these applications due to its durability and strength.
• Automotive Industry: Carbon steel is 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.
• Rapid Urbanization: The migration of people from rural areas to urban cities requires the construction of housing and other amenities. This again drives demand for steel in the construction sector.
• Energy Sector: The energy industry, including oil and gas, requires pipelines, rigs, and other infrastructure, much of which is made using carbon steel.

Carbon Steel Market Opportunities

• Green Steel Production: As environmental concerns gain prominence, there's a push for more sustainable steel production methods. Opportunities lie in producing carbon steel using methods that emit fewer greenhouse gases or even adopting technologies that capture and utilize emitted 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.
• 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's a growing 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 can command premium prices.

Carbon Steel Market Trends

• Sustainability and Emission Reduction: The global push for sustainability has made reducing carbon emissions in steel production a priority. Innovations in green steel production methods, such as hydrogen-based steelmaking, are 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 simplify the buying process and can offer insights into customer behavior and demand patterns.
• Value-added Products: There's a growing trend towards producing and offering carbon steel products with additional value, such as coatings that resist corrosion, or treatments that enhance durability.

Carbon Steel Market Restraints

• Environmental Concerns: Steel production, particularly in blast furnaces, results in substantial CO2 emissions. As global emphasis on sustainability grows, there's increased pressure on the industry to adopt greener production methods, which can sometimes be cost-intensive.
• 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.

Recent Developments

New product launches

• POSCO launches 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 launches 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 Steel launches 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 $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 $5.4 billion. This deal gave China Baowu a major foothold in the global steel market.

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

Top companies in Carbon Steel Market

• ArcelorMittal
• 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.