Green Steel Market to Witness High Growth Owing To Rising Environmental Concerns

The Green Steel Market is estimated to be valued at US$ 4.33 Bn in 2024 and is expected to exhibit a CAGR of 60.2% over the forecast period 2024- 2031, as highlighted in a new report published by Coherent Market Insights.

Key Market Dynamics:

The green steel market is mainly driven by the rising environmental concerns worldwide. Steel production is a highly carbon-intensive process and carbon emissions from steel production is a major contributor to global warming. Rising carbon taxes and stringent policies by various governments to reduce carbon emissions are compelling steel producers to adopt low-carbon production technologies. Further, growing demand for recyclable and sustainable materials from major industries like automotive and construction is also providing a boost to the green steel market.

Key Market Trends:

Today’s steel producers are increasingly investing in green hydrogen DRI plants and carbon capture technologies to produce green steel and lower carbon footprint. Green hydrogen is poised to play a major role in decarbonizing heavy industries like steel manufacture. Countries like Sweden, Germany and Japan have unveiled plans for large-scale production of green hydrogen using renewable energy to power steel manufacturing.

At the same time, carbon capture and storage (CCS) technologies are also gaining traction with companies developing pilot projects. EAF steel production using scrap metals is also rising globally to meet the increasing demand for steel and support sustainability goals.

Major steelmakers have announced targets and roadmaps to reduce carbon emissions substantially in the coming decades with significant investments in green technologies.

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Market Opportunities

By Process Type Insights

Green steel production using hydrogen direct reduction process is expected to be a major market opportunity over the forecast period. Hydrogen direct reduction does not involve carbon in the steelmaking process and utilizes hydrogen gas to reduce iron ore to iron. This produces steel with zero direct carbon emissions. Startups and major steel producers are investing heavily in developing hydrogen direct reduction technologies to transition to green steel production. For instance, H2 Green Steel is developing a plant in Northern Sweden to produce fossil-free steel using hydrogen.

By End User Industry insights

Growing demand for green steel from the construction industry is another key opportunity area. The construction sector accounts for a large share of global steel consumption. With tightening emissions regulations, construction companies are actively pursuing ways to reduce the carbon footprint of buildings. Using green steel produced via low-carbon methods can help construction firms lower embodied carbon in infrastructure and building projects. Several companies have already begun using traceable green steel certified via blockchain in high-profile construction projects.

Key Market Takeaways

The global green steel market is anticipated to witness a CAGR of 60.2% during the forecast period 2024-2031, owing to increasing investments by major steelmakers in transitioning to low-carbon production methods.

On the basis of process type, the hydrogen direct reduction segment is expected to hold a dominant position, accounting for over 30% market share by 2031 due to the potential to produce steel with zero direct carbon emissions.

By end user industry, the construction segment is projected to be the largest consumer of green steel during the forecast period, driven by increasing demand for low-carbon materials in the infrastructure and building construction sectors.

Regionally, North America is expected to dominate the overall green steel market through 2031, mainly because of supportive government policies and investments by major steel producers to develop green production capabilities in the region.

Competitor Insights:

Ansteel Group

Boston Metal

Swiss Steel Group

H2 Green Steel

Recent Developments in Green Steel Market

Green Steel Production Methods Gain Momentum

Major steel producers are investing heavily in green production methods like hydrogen reduction and electric arc furnaces to lower carbon emissions. These next-generation steelmaking technologies rely on renewable energy instead of fossil fuels. Sweden’s HYBRIT and Germany’s SSAB are leading the commercialization of hydrogen direct reduction plants that aim to deliver fossil-free steel. Major carmakers like BMW and Volvo have pledged to only use green steel in vehicles by 2025 or sooner, ramping up demand.

Europe Solidifies Leadership Position in Green Steel Market

Thanks to its sustained focus on decarbonization policies and green industrial strategy, Europe is well-positioned to dominate the rapidly expanding green steel market through 2023-2024. Major steel producers in Germany, Sweden, and elsewhere are already delivering tonnage of fossil-free steel to high-profile customers. Technological leadership and first-mover advantage in hydrogen and electric steelmaking gives European nations an edge globally. Support through the European Green Deal recovery fund will turbocharge investments in emerging clean technologies and production capacity across the region. Europe aims to be the first climate-neutral continent by 2050, requiring a near-complete transition to green steel production well before then. With a strong regulatory and funding framework supporting decarbonization, Europe looks set to remain the green steel capital of the world.

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About Us:

Coherent Market Insights is a global market intelligence and consulting organization that provides syndicated research reports, customized research reports, and consulting services. We are known for our actionable insights and authentic reports in various domains including aerospace and defense, agriculture, food and beverages, automotive, chemicals and materials, and virtually all domains and an exhaustive list of sub-domains under the sun. We create value for clients through our highly reliable and accurate reports. We are also committed in playing a leading role in offering insights in various sectors post-COVID-19 and continue to deliver measurable, sustainable results for our clients.