Europe Green Steel Market 2025 – 2034

Reports Description

As per the Europe Green Steel Market analysis conducted by the CMI Team, the Europe Green Steel Market is expected to record a CAGR of 63.2% from 2025 to 2034. In 2025, the market size is projected to reach a valuation of USD 1.25 Billion. By 2034, the valuation is anticipated to reach USD 64.82 Billion.

Europe Green Steel Market Overview

The European green steel market today forms part of the rapidly expanding markets for sustainable and low-carbon steel production. Such technological options as green steels, nowadays, represent an important group of technical frameworks that will help the European Union achieve its carbon reduction level objectives, especially since steel represents one of the most carbon-intensive industries.

Green steel production emphasizes renewable energy and hydrogen and electric arc furnaces as its main technical paths rather than the coal-based approaches. There is ongoing research and industrial implementation led by companies such as SSAB, Tata Steel, and H2 Green Steel, involving hydrogen-based steel-making processes and other sustainable practices.

On the other hand, the EU regulations supporting the market include CBAM and steel safeguard measures extended within the EU framework. Challenges do, however, remain, including the high cost of production for the green steelmakers, disruptions in the supply chain, and uncertainty regarding the policy direction. Regardless of these challenges, the green steel market in Europe is destined to continue on a path of growth due to the alignment of governments and industry on carbon NEUTRALITY by 2050, within which green steel remains an essential component of future manufacturing.

Europe Green Steel Market Significant Growth Factors                                           

The Europe Green Steel Market Trends presents significant growth opportunities due to several factors:

• Government Regulations and Policies: Rigorous environmental policies and regulations in the EU constitute a major driver for the green steel market. The European Green Deal and the Carbon Border Adjustment Mechanism set the bar high for CO₂ emissions reductions in various industries, especially in steel manufacturing. Such regulations provide incentives for companies to embrace cleaner production techniques such as hydrogen-based steelmaking, as well as to invest in sustainable technologies. Funding programs and policies of the EU toward green steel initiatives, especially decarbonization policies, are propelling the growth of this market, a key factor in hastening the transition toward a low-carbon economy.

• Technological Advancements: Technological innovation in steel production pertaining chiefly to hydrogen and electric arc furnace (EAF) technologies would remain critical for green steel market growth. Hydrogen reduction methods offer a potential pathway towards massive reduction in CO₂ emissions in steel production-for example, the HYBRIT project by SSAB. Meanwhile, improvements in technologies for capturing, utilizing, and storing carbon (CCUS) and the advancement of molten oxide electrolysis continue to stretch the possibilities for making green steel economically and environmentally sustainable.

• Increasing Demand for Sustainable Products: Increasing consumer demand for sustainable products is driving the growth of the green steel market. Being heavily used in industries like automotive, construction, and energy, where sustainability is increasingly being prioritized in their supply chain, the demand for eco-friendly materials such as green steel is increasing at a fast pace. The auto industry, in particular, increasingly embraces more sustainable production processes, bringing green steel into vehicle manufacturing to satisfy carbon neutrality targets. The construction industry is likewise embracing green steel in infrastructure works to mitigate the carbon footprint. Awareness on the part of consumers and businesses concerning the environmental impact of steel production trends toward higher demand for green steel in the marketplace.

• Investment in Renewable Energy: The Transition to renewable energy became one of the more important factors pushing the green steel market. Many green steel production technologies, especially hydrogen-based ones, require large amounts of renewable electricity. With the increase of renewable energy installations like wind, solar, and hydro in Europe, it becomes more feasible to supply clean electricity for steelmaking. Therefore, this transition not only bolsters steel industry decarbonization but also enhances the economic case for green steel. Investment in renewable energy infrastructures, therefore, directly promotes the growth of the green steel market through facilitating cleaner and sustainable production processes.

• EU’s Carbon Neutrality Goals: The carbon neutrality target of the European Union by the year 2050 is thus a significant driver for the growth of the green steel market. The ‘road to carbon neutrality’ must entail decarbonizing industries such as steel, known as one of the largest contributors of CO₂ to the environment. Therefore, the EU’s commitment to large investments in green technologies, including the production of green steel, and policy frameworks supporting carbon-reduction initiatives are becoming relevant. This has prompted both established and new producers of steel to begin the transition into making sustainable practices a priority. Support from the EU for various green steel projects, with their emphasis on clean technologies, is thereby hastening the transition toward more sustainable production practices.

Europe Green Steel Market Significant Threats

The Europe Green Steel Market faces several significant threats that could impact its growth and profitability in the future. Some of these threats include:

• High Production Costs: The switch to renewable steel production methods like hydrogen-based technologies and electric arc furnaces will incur tremendous initial costs. Massive investment in the infrastructure relative to construction for hydrogen production and renewable energy sources will be required as a result of such technologies. The high price of renewable hydrogen as compared to traditional carbon-intensive processes plays a significant role in the scalability of green steel. It is putting companies under the pressure of balancing their profitability against environmental goals. High production costs are economic obstacles associated with this, which slow down adoption across the industry. Small players will suffer more from this because they lack enough capital to invest in green technologies.

• Policy Uncertainty and Regulatory Risks: Several European governments have introduced incentives for the green steel transition, but these incentives carry uncertainty over future disincentives. Any policy change, such as that related to carbon pricing or environmental regulations, could result in severe damage to the green steel project economics. Such unpredictability will not augur well for investments over the long term because there are also fears that government support will be more sporadic after 2030, when the world will have heightened ambitions for decarbonization. Steel firms also suffer from uncertainty because of EU trade policies, such as tariffs on imports from third countries and competition with countries with more lax emissions regulations.

Europe Green Steel Market Opportunities

• Increase in Demand for Sustainable Products: The demand for green steel would rise as industries such as automotive, construction, and consumer goods embrace sustainability. Automotive manufacturers, in particular, are increasingly adopting green steel to meet emissions standards and appeal to environmentally conscious consumers. A world slowly shifting toward a circular economy with increasing demand for environmentally friendly products offers producers of green steel lucrative opportunities for market expansion. The demand for green steel will also be driven by the construction sector, focusing increasingly on sustainable buildings and infrastructure, thus presenting major opportunities for producers to capture markets.

• Government Support and Investments: Governments worldwide, more so in Europe, are bent on pursuing decarbonization of industries and providing monetary incentives and policy support for projects throughout the value chain targeting green steel. The major drivers include the European Green Deal and the carbon reduction targets outlined by the EU. Programs such as assistance for renewable energy facilities, carbon capture, and green steel production methods enable opportunities to mitigate risks toward investments. Moreover, the EU’s Carbon Border Adjustment Mechanism encourages steelmakers to go greener by imposing tariffs on carbon-hurtful imports, thus giving an advantage to green steel producers.

• Technological Advancements and Innovation: Recent technological innovations in hydrogen production, carbon capture, and electrolysis mark moments of transformation for the steel industry and substantially provide opportunities for the green steel makers. The commercialization of hydrogen-based steelmaking processes is being looked at by companies such as SSAB and H2 Green Steel, which could have significant reductions in carbon emissions and increase the sustainability of steel production. The advancements of renewable energy sources and further digitization of steel-making processes may also improve operational efficiencies, thus leading to lower energy consumption and increased output. These technological advances will create new ways to enhance the cost-effectiveness of companies and competitiveness in the marketplace.

Europe Green Steel Market Category-Wise Insights

By Product Type

• Products in Flat Steel: Flat steel products, which comprise coils, sheets, and plates, form a vital part of industries such as the automotive, construction, and appliance industries. The automotive sector’s increasing need for lightweight and durable materials, coupled with the construction industry’s pursuit of building sustainable infrastructure, is driving the adoption of green steel for these products. With industries seeking to meet increasingly stringent environmental norms, the demand for flat steel products made via green steel would be on the rise. Since green steel makes the production of high-quality, eco-friendly flat steel products feasible, it also becomes more attractive for these industries, further increasing its share within the market.

• Long Steel Products: Long steel products are the rebar, wire rods, angles, or beams that form the backbone of infrastructure and construction works. These products find themselves amidst ever-increasing demand for green steel, while the construction industry finds itself on a path toward the adoption of sustainable materials. A green transition for the long steel production line is highly desirable as it promotes the reduction of carbon footprints on infrastructure projects. The use of green steel for long steel products is likely to grow, with backing from the authorities that endorse green building measures and sustainable infrastructure development. This, in turn, offers a window of opportunity for producers of green steel to modify their product offering and supply the growing construction sector.

• Others: The “Others” category chiefly comprises specialized steels that serve niche markets in aerospace, defense, and high-tech industries. While these markets are smaller than automotive and construction, they are still an important opportunity for green steelmakers. These sectors need high-strength and lightweight materials that can withstand very rigorous performance criteria, for which green steel provides a sustainable alternative in contrast to conventional steel. As industries in various other sectors try to reduce their environmental impact, the demand for green steel in specialized applications will also increase, thus enabling further growth from the angle of steel producers.

By Application

• Automotive: On one hand, green steel is among the important factors propelling the automotive industry towards broadening demand. The makers of car manufacturing the vehicles, along with increasing demand for green steel in the manufacturing of vehicles, wherein it becomes compulsory to meet standards and regulations regarding environmentally friendly production, as well as consumer demand regarding the sustainability of such products. The parts manufactured under green steel are lightweight, durable, and eco-friendly to achieve high benefits toward less carbon footprint on vehicles. Major automobile manufacturers are now setting sustainability targets, which include green steel for procurement by these manufacturers. With this, ample market opportunities are now open for steel producers. The ongoing transition of automobiles to EVs will further drive the need for sustainable steel, as the demand for high-strength lightweight materials increases.

• Construction: Sustainable green steel is required by the construction industry to take form for infrastructure projects, as it provides the much-needed sustainable and low-carbon materials for such intended projects. With increasing emphasis on green building certifications by government and private enterprises, green steel demands are on the rise. In modern days, steel is a quintessential material in construction. It finds applications to make almost everything, such as bridges, buildings, roads, and railways. In meeting sustainability goals in that industry, green steel has proven to be a perfect fit for green buildings. Increased focus on urbanization and infrastructural growth in Europe and incentives toward green building are expected to drive the speed of green steel consumption within the sector.

• Energy: Concerning its applications in the making of wind turbines, solar panels, and different kinds of infrastructure based on renewable energy, green steel comes into its own as a major element affecting the whole renewable energy sector. As countries strive to achieve their target of clean energy, demand for green steel is likely to rise. Wind turbine production is especially dependent on higher-strength steel components, such as blades and towers, in their design. A lower carbon footprint makes green steel an ideal choice for such applications aligned with the industry’s goals to attain a reduced greenhouse gas emission pattern. An increase in renewable energy capacity is accompanied by higher demand for green steel, thus promising a big market opportunity for producers in the sector.

• Appliances: There is an increasing trend of green steel finding its way into the manufacture of household appliances. This happens mainly because eco-friendly products are the darling of consumers. Most household appliances, such as refrigerators, air conditioners, and washing machines, are made of parts of steel. Recently, sustainability has become one of the most considerable criteria among consumers in making buying decisions. Under this situation, appliance manufacturers are gradually active in adopting straight green steel to respond to green consumers’ demands. The appliance industry is focused on most appliances becoming energy efficient, with low carbon footprints produced, giving more opportunities for steel producers to enter this emerging market base.

• Others: The use of green steel is seen in various niche industries besides automotive, construction, and energy. One of the major applications is in the aerospace sector, which requires its use in manufacturing aircraft components from lightweight and high-strength materials to reduce fuel consumption and carbon emissions during flight. Heavy machinery manufacturing benefits from green steel, with the industry looking for sustainable solutions in equipment used for mining, agriculture, and construction. Defense industries are turning to green steel as a priority to provide sustainable, high-performance construction materials for military applications and infrastructure. Green steel can also find applications in marine construction, like ships and offshore platforms, where it finds durable parts resistant to corrosion. With green steel offering an avenue to environmental impact reduction, its applications have been expanding in line with the rising sustainability frontiers in different industries.

European Green Steel Market Impact of Recent Tariff Policies

Recently, the tariff policies of the European Union, particularly the extension of safeguard conditions for steel, have made a huge difference to the green steel market. It was on June 25, 2024, when the European Commission went ahead to extend the safeguard measure on steel until June 2026, protecting EU steel producers from global overcapacity and diverted trade.

Aimed at stabilizing the EU marketplace and limiting the influx of cheap imports that previously blew up most of the pricing and market conditions, it is simply reinstituting a safeguard measure that was never lifted in the first instance to protect EU steel producers against overcapacity developing in the rest of the world and then trade being diverted into Europe through unfair measures. Also, in March 2025, the commission adopted stricter import quotas, whereby it reduced the annual liberalization rate for tariff-free steel imports from 1% to 0.1% and removed the carry-over mechanism for unused quotas.

Overall, these tariff measures have had a mixed effect on the green steel sector. On the one hand, they have actually protected EU producers in that they have caused higher investments in green steel technologies, as is the case with such companies as H2 Green Steel. In fact, on the flipside, these tariffs have also resulted in increased production costs and supply chain hurdles, thus resulting in delays in investments from major players like ArcelorMittal.

Report Scope

Europe Green Steel Market Regional Analysis

The Europe Green Steel Market is segmented into various countries, including Germany, Sweden, The Netherlands, France, Italy, the United Kingdom, Spain, and the Rest of Europe.

• Europe: According to carbon emission reduction goals and reaching carbon neutrality by 2050, the European green steel market will witness enormous growth. Sweden, being a frontrunner in the European green steel market, is participating in initiatives such as the HYBRIT project. SSAB, in conjunction with LKAB and Vattenfall, concerns itself with the development of a new production process for fossil-free steel, utilizing hydrogen instead of coal and thus effectively cutting CO₂ emissions. This entire processing technology must be achieved as quickly as possible, establishing a global benchmark for sustainable steel production and placing Sweden at the forefront.

Germany is yet another powerhouse of green steel production, with Thyssenkrupp investing heavily in low-emission technologies and green steel plants. The push put forth by the German government will further strengthen regulatory initiatives towards decarbonization and sustainability within the green steel system. The Netherlands, too, is on the right track, with companies such as Tata Steel working toward emission reductions through hydrogen-based steelmaking and other advanced methods.

Europe Green Steel Market Key Developments

In recent years, the Europe Green Steel Market has experienced a number of crucial changes as the players in the market strive to grow their geographical footprint and improve their product line and profits by using synergies.

• In January 2025, Thyssenkrupp revealed plans for a €3 billion green steel plant in Duisburg, Germany. The facility is designed to operate using natural gas initially, with the potential to transition to green hydrogen, aiming to reduce CO₂ emissions by up to 50% compared to traditional methods.

• In November 2022, POSCO announced a $40 billion investment plan to develop green hydrogen and steel production facilities in Australia by 2040. This initiative aims to enhance POSCO’s capacity for producing low-emission steel and contribute to global decarbonization efforts.

• In October 2023, Tata Steel signed its first green steel contract with JCB, committing to supply steel produced via electric arc furnace technology at its Port Talbot plant in Wales. This transition is part of Tata’s strategy to reduce carbon emissions and support sustainable manufacturing.

• In October 2022, H2 Green Steel secured €3.5 billion in funding to establish a hydrogen-powered steel plant in Boden, Sweden. This investment aims to produce green steel at an industrial scale, significantly reducing CO₂ emissions associated with traditional steel production methods.

• On August 31, 2020, SSAB, in collaboration with LKAB and Vattenfall, inaugurated the world’s first pilot plant for fossil-free steel production in Luleå, Sweden. This facility marks a significant step towards eliminating carbon emissions in steelmaking by utilizing hydrogen instead of coal

These important changes facilitated the companies’ ability to widen their portfolios, to bolster their competitiveness, and to exploit the possibilities for growth available in the Europe Green Steel Market. This phenomenon is likely to persist since most companies are struggling to outperform their rivals in the market.

Europe Green Steel Market Competitive Landscape

The Europe Green Steel Market is moderately consolidated, with a large number of product providers globally. Some of the key players in the market include:

• SSAB
• ArcelorMittal
• Thyssenkrupp
• Tata Steel
• Salzgitter AG
• Voestalpine AG
• H2 Green Steel
• POSCO
• Hyundai Steel
• Nucor Corporation
• JSW Steel
• S. Steel
• Sweden’s SSAB (HYBRIT project)
• Luxembourg’s Aperam
• Steel Dynamics
• AMETEK Inc.
• Baowu Steel Group
• Liberty Steel Group
• Riva Group
• Severstal
• Others

These companies implement a series of techniques to penetrate the market, such as innovations, mergers and acquisitions, and collaboration.

The competitive arena of the European green steel market is constituted by various actors, most importantly SSAB, H2 Green Steel, Tata Steel, Thyssenkrupp, and POSCO. These companies invest heavily in sustainable steel production technologies such as hydrogen-based reduction and electric arc furnaces. SSAB, for instance, is piloting the HYBRIT project in Sweden aimed at zero CO₂ emissions in steel production.

H2 Green Steel, well-funded and hydrogen-based in its steel production, considers itself a serious disruptor. Tata Steel and Thyssenkrupp, on the other hand, are making large investments into low-carbon technologies to mitigate their environmental impact while responding to demand for green steel from the automotive and construction industries.

Markets are rapidly evolving under the pressure of decarbonization and EU regulations. They are therefore innovation-driven, with heavy investments directed into green technologies and a strong regulatory framework to back them. Competition remains fierce, with companies racing to implement full-scale development of their green steel production capability, bring costs down, and usher in the next sustainable way for steel production.

The Europe Green Steel Market is segmented as follows:

By Product Type

• Flat Steel Products
• Long Steel Products
• Others

By Application

• Automotive
• Construction
• Energy
• Appliances
• Others

Regional Coverage:

Europe

• Germany
• France
• U.K.
• Russia
• Italy
• Spain
• Netherlands
• Rest of Europe