Global Green Steel Market 2025–2032: Low-Carbon Steel Transition Driven by EAF Adoption, Hydrogen-Based DRI, and Sustainable Infrastructure Demand

The exceptionally high CAGR of 55.6% reflects the Green Steel market’s early-stage base effect, where limited commercial capacity in 2025 is followed by large-scale commissioning of hydrogen-based DRI plants, EAF expansions, and policy-mandated decarbonization investments across Europe, Asia Pacific, and North America. Market growth is further amplified by long-term offtake agreements, green public procurement mandates, and accelerated capital deployment toward low-carbon steel capacity rather than incremental efficiency upgrades.

 

Green Steel Market: Low-Carbon Shift, Hydrogen Innovation, and Global Growth

Green Steel refers to steel produced with significantly reduced or near-zero carbon emissions through Electric Arc Furnace (EAF) routes using recycled scrap, hydrogen-based direct reduced iron (H?-DRI), biomass-assisted blast furnace processes, or advanced carbon capture technologies. It is positioned as a critical material for decarbonizing construction, automotive, energy, and industrial value chains under net-zero and ESG compliance frameworks.

 

Global Green Steel Market is rapidly shifting toward low-carbon production through Electric Arc Furnace (EAF) technology and Hydrogen-Based Steel Production (H2 DRI), driven by carbon regulations, energy efficiency gains, and hydrogen policy support. Key opportunities lie in Sustainable Steel for Building and Construction Sector and Low-Carbon Steel for Green Infrastructure Projects, despite high electrolyser costs and limited hydrogen infrastructure. Asia Pacific leads growth with volume-driven growth, while Europe sets policy-driven benchmarks. Adoption of EAF, H2 DRI, and carbon capture technologies is central to competitiveness, investment, and long-term market transformation.

 

Green Steel Market Key Highlights -

 

• Structural Technology Shift: By 2032, approximately 54% of new global steelmaking capacity is expected to adopt Electric Arc Furnace (EAF) routes, marking a decisive shift away from BF-BOF dominance.
• Regulatory-Driven Demand: Carbon pricing, CBAM mechanisms, and national decarbonization mandates are accelerating hydrogen-based steel adoption, enabling an estimated reduction of over 20.5 million tonnes of CO? emissions.
• Capital Reallocation Opportunity: Hydrogen-based DRI and low-carbon steel for green infrastructure represent the fastest-scaling investment segments.
• Adoption Constraints: High electrolyser costs (USD 1,400–2,500/kW) and limited green hydrogen infrastructure remain key barriers to rapid commercialization.
• Regional Divergence: Asia Pacific leads in volume-driven growth, while Europe establishes policy-driven and technology-led benchmarks.

 

 

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Green Steel Trends: Rapid Shift Toward EAF and Hydrogen Steel

• As of 2025, nearly 62% of global crude steel production capacity remains based on blast furnace–basic oxygen furnace (BF-BOF) routes, while Electric Arc Furnace (EAF) steelmaking accounts for approximately 29%. By 2032, more than half of all newly commissioned steelmaking capacity is expected to adopt EAF-based routes, driven by recycled steel availability, renewable electricity integration, and tightening emissions regulations.
• By 2032, nearly 54% of new global steelmaking capacity is expected to be developed using Electric Arc Furnace (EAF) Technology in Steel Manufacturing, signalling a rapid transition toward low?carbon steel production aligned with Net?Zero Steel Manufacturing and climate policies.
• Hydrogen-based direct reduced iron (H2-DRI) combined with EAF is emerging as a critical alternative pathway in decarbonized steelmaking, expected to contribute substantially to primary steel production by mid-century. This enables Green Steel Production Using Hydrogen DRI.

 

 

Policy Pressure and Hydrogen Investment Boost Green Steel Growth

The steel industry contributes nearly 7% of global CO₂ emissions, prompting stringent carbon regulations to incentivize Sustainable Steel Production and enforce compliance through GHG monitoring and reporting.

 

Energy efficiency initiatives across major steel-producing economies have achieved 5.583 million tonnes of oil equivalent (MTOE) in energy savings, translating into nearly 20.52 million tonnes of CO₂ reduction in 2024-2025.

 

India’s National Green Hydrogen Mission, active through FY 2029-30, has a total budget of nearly USD 2.4 billion, including nearly USD 55 million specifically for pilot hydrogen projects in steel production. This policy support accelerates Hydrogen-Based Steel Production scaling.

 

Hydrogen Steel Scaling Unlocks Next-Generation Investment Opportunities

Scaling hydrogen-based steelmaking presents a significant investment pathway to decarbonize both the Steel Recycling Industry and primary steel production.

 

Pilot plants producing 100% hydrogen-based DRI are validating technical feasibility, paving the way for commercial adoption of hydrogen-based processes.

 

Investment focus includes hydrogen supply chains, electrolyser capacity growth, and integrated facilities targeting Sustainable Steel for Building and Construction Sector markets.

 

High Hydrogen Costs and Infrastructure Gaps Restrain Green Steel Growth

• High capital expenditure for green hydrogen production remains key constraint electrolyser costs range from USD 1,400 to USD 2,500 per kW, limiting rapid deployment of hydrogen-based green steel plants.
• Limited green hydrogen infrastructure constrains supply chain integration, increasing project complexity and extending payback periods for investors in 2025.

 

EAF Technology and Green Infrastructure Drive Green Steel Demand

Production Technology Segment

• Electric Arc Furnace (EAF) steelmaking has become a core low-carbon production route by 2025, driven by its compatibility with recycled steel feedstock, renewable electricity integration, and flexible operations. Its increasing deployment reflects industry-wide alignment with Low-Carbon Steel Market objectives and Electric Arc Furnace Technology in Steel Manufacturing as a foundation for decarbonized steel manufacturing.
• EAF routes enable the use of Recycled Steel and renewable energy inputs, reinforcing its role in the Low-Carbon Steel Market.

 

End-Use Industry Segment

 

• Demand for green steel in building, construction, and infrastructure is projected to reach 4.49 million tonnes by 2030, with construction contributing 2.52 million tonnes and infrastructure 1.5 million tonnes.
• By 2040, total demand across these sectors is expected to grow to 73.44 million tonnes, reaching 179.17 million tonnes by 2050.
• Construction and infrastructure together account for approximately 78% of finished steel demand, highlighting their key role in green steel adoption.

 

 

Green Steel Market Regional Insights

 

Asia Pacific: It remains the dominant Global Steel Production and consumption hub, supported by large domestic markets, industrial growth, and active policy support for Sustainable Steel Manufacturing. Strategic investments in Hydrogen-Based Steel Production, renewable-powered steelmaking, and modernization of legacy assets position the region as the primary growth engine of the Global Sustainable Steel Market in 2025.

 

Europe: Advanced regulatory frameworks under the European Green Deal support accelerated adoption of Hydrogen-Based Steel Production and EAF technologies. Europe provides policy and technological benchmarks that guide global decarbonization initiatives.

 

Breakthrough Technologies and ESG Investments Redefine Green Steel Leadership

• ArcelorMittal: In its 2025 Sustainability Report, the company highlighted production sites achieving low-carbon steel output with low CO₂ intensity. It growthed Responsible Steel certification to 42 facilities and invested over USD 1 billion in decarbonization projects, aligning with ESG-Driven Steel Investments.
• Boston Metal: Commissioned Molten Oxide Electrolysis (MOE) industrial cells for near-zero carbon steel, with commercial demonstration plant deployment planned in 2026. MOE represents a breakthrough hydrogen-free electrification approach.

 

Recent Developments

 

Company	Year	Recent Development
ArcelorMittal	2024	Launched HyMatch steel for hydrogen infrastructure and expanded XCarb low-carbon steel certificates; advanced low-carbon projects across hydrogen, biomass, EAF, and carbon capture technologies
HYBRIT	2024	Produced over 5,000 tonnes of hydrogen-reduced iron in pilot operations, demonstrating near-zero CO? emissions and validating industrial feasibility
Boston Metal	2025	Raised funding via convertible note to accelerate Molten Oxide Electrolysis (MOE) commercial deployment and industrial-scale MOE commissioning
H2 Green Steel (Stegra)	2025	Advanced construction and installation of electrolysers and steel production facilities; over 50% of electrolysis modules installed, key structural milestones completed

 

Global Green Steel Market Scope:

 

Global Green Steel Market
Report Coverage	Details
Base Year:	2025	Forecast Period:	2026-2032
Historical Data:	2020 to 2025	Market Size in 2025:	USD 8.46 Billion
Forecast Period 2026 to 2032 CAGR:	55.6%	Market Size in 2032:	USD 186.83 Billion
Global Green Steel Market Segment Analysis	By Product Type	Flat Steel Long Steel Tubes and Pipes
	By Production Technology	Electric Arc Furnace (EAF) Hydrogen-Based Direct Reduced Iron (H-DRI) Carbon Capture Utilization and Storage (CCUS) Blast Furnace with Biomass Injection Molten Oxide Electrolysis
	By End User Industry	Construction and Infrastructure Automotive and Transportation Energy and Utilities Manufacturing Others

 

Green Steel Key Players

1. Arcelor Mittal
2. Boston Metal
3. Carbon Re
4. Electra
5. Emirates Steel Arkan
6. GravitHy
7. Green Steel Group Inc.
8. H2 Green Steel
9. Helios
10. HYBRIT
11. JFE Steel Corporation
12. Nippon Steel Corporation
13. Nucor Corporation
14. POSCO International
15. Shougang Group
16. Salzgitter AG
17. Smart Steel Technologies
18. SSAB
19. Steel Corporation
20. Tata Steel
21. Thyssenkrupp Steel
22. U.S. Steel Corporation
23. Voestalpine AG
24. Arvedi
25. Outokumpu Oy
26. Swiss Steel Group
27. Essar Steel
28. Riva Group
29. Feralpi Group  
30. Sidenor