Europe's green steel market entered the new year sluggishly with limited buyer interest. Sellers expect CBAM and the phase-out of free carbon allowances to lift demand in 2026, but effects are not expected in the short term.
EFRS 2026 Executive Board Chair and Ekinciler Group CEO Fatih Keseroğlu says green steel is a measurable, verifiable, and data-driven long-term transformation process, with digitalisation playing a decisive role.
The EU proposes more flexible CO2 targets for 2035, allowing continued production of ICE and hybrid vehicles. Up to 10% of emissions can be offset using low-carbon steel, potentially creating ~1 million tonnes of annual green steel demand.
European scrap processors and EAF steel producers have written to the European Commission objecting to a one-size-fits-all sliding scale label, arguing it fails to recognise the low CO2 profile of Europe's EAF industry.
CBAM is a de facto trade mechanism that redefines competition through carbon costs. Türkiye's EAF advantage is significant but hinges on decarbonising its electricity mix. The Brussels Effect is transforming steel trade globally.
ArcelorMittal officially announced a €1.3 billion EAF investment at its Dunkirk facility. The 2 million tonne capacity furnace is planned to go live in 2029, emitting three times less CO2 than a blast furnace.
Tosyalı Holding's second DRI plant in Algeria has begun commercial production. Capable of running on both natural gas and 100% hydrogen, it is the world's first FlexiDRI plant to reach commercial production.
As of 2026, carbon regulations, energy prices, and certification rules are shaping green steel. The global market is witnessing regional divergence rather than a unified leap forward.
Green steel is low-carbon steel produced using green hydrogen and renewable energy instead of fossil fuels. As the steel industry accounts for 7–9% of global CO₂ emissions, this production approach aims to fundamentally change the equation.
Steel producers are moving away from traditional blast furnace methods toward hydrogen-based technologies to eliminate carbon emissions. Tightening carbon regulations and supply chain pressures are accelerating the transition to green steel.