As in the past, OECD data confirms that global steelmaking capacity continues to grow despite weak demand and a sluggish economic outlook. By the end of 2024, global steelmaking capacity had reached 2,472 million metric tonnes and is expected to rise further in the coming years. Nearly half of this capacity is in China, where declining domestic demand since 2020 has driven production towards export markets, increasing pressure on other economies.

Meanwhile, new trade tariffs, including between major OECD economies, are adding further uncertainty which could negatively impact demand and investment, putting steelworkers' jobs at risk worldwide.

Trade unions continue to emphasise that steel overcapacity and rising trade tensions are only one side of the problem—the other is weak domestic demand. Union representatives at the OECD Steel Committee are calling for ambitious and comprehensive industrial policies to boost demand and set higher standards by incorporating labour and environmental conditions. They also urge large companies to reinvest their profits in new and green technologies to drive sustainable economic growth and create positive spillover effects across other sectors.

Currently, responses from major OECD economies are inconsistent. In the United States, rising tariffs are accompanied by efforts to roll back clean energy and industrial projects approved under the Inflation Reduction Act. In the European Union, increased fiscal flexibility for defence spending may not be the best solution for lifting European production, as the vast majority of defence goods are imported from outside the EU, and decoupling from US suppliers together with expanding European military output capacity could take many years. Meanwhile, other urgent priorities—such as social cohesion funds and investment in infrastructure, healthcare, and education—are pushed further down the agenda.

Veronica Nilsson, TUAC General Secretary, warns: “As the case of steel shows, inadequate public investment and low private consumption make domestic industries more exposed at times of heightened trade tensions. Instead of pursuing fiscal consolidation, limiting public investment and devaluing wages through labour market reforms that reduce labour protection and the bargaining power of workers, governments should pursue expansionary fiscal policies and targeted industrial strategies that strengthen domestic resilience while protecting quality jobs and workers’ rights.”

Christina Olivier, Assistant General Secretary at IndustriALL Global Union, says: "Governments must adopt proactive industrial strategies that align economic, environmental, and social goals. Steel is the backbone of our economies—protecting the sector means protecting workers, communities, and the future of manufacturing."

Judith Kirton-Darling, General Secretary of industriAll Europe, concludes: "Europe’s steel industry is at a crossroads. Without urgent action to boost demand and secure investment, we risk losing critical industrial capacity and high-quality jobs. Workers cannot be left to bear the brunt of trade tensions and economic uncertainty. We need a coordinated EU industrial policy that safeguards quality jobs and turns the promise of a just transition into reality."