Germany’s crude steel production posted a modest recovery in the first quarter of 2026, although industry representatives caution that underlying demand remains weak.
Output reached around 9.3 million tonnes in the first three months of the year, up 9% year-on-year. March production also rose by 7.5% to 3.3 million tonnes compared with the same month in 2025.
However, Kerstin Maria Rippel, Managing Director of Wirtschaftsvereinigung Stahl, warned that the improvement should not be overstated. “Despite the increase in production, the situation in the steel industry remains tense,” she said, noting that annualised output of around 37 million tonnes is still “below the threshold of 40 million tonnes – the minimum for healthy capacity utilisation in our industry”.
Germany’s crude steel production had already fallen to a historically low level of 34.1 million tonnes in 2025, comparable to levels seen during the global financial crisis in 2009
Structural demand weakness persists
The current situation reflects a longer-term decline in demand. Since 2017, steel consumption in Germany has dropped by around 30%, equivalent to roughly 12 million tonnes. Key sectors such as automotive and mechanical engineering continue to show subdued activity.
Recent signs of stabilisation are largely driven by inventory build-up rather than a genuine recovery in demand. In a global comparison, Germany has slipped to eighth place among the largest steel-consuming markets.
Import pressure and overcapacity remain key challenges
High import pressure continues to weigh on the market, driven by global overcapacity, which the OECD expects to exceed 700 million tonnes by 2027.
Rippel welcomed the EU’s recent agreement on new trade defence measures, calling it “an important step” and stressing that “for our industry, this is vital for survival
Outlook remains uncertain
Leading indicators offer no clear signal of a sustained recovery. Order intake has improved slightly but remains at a low level, while geopolitical risks are not yet fully reflected in the data.
The ifo business climate index has also remained below its long-term average since 2022, highlighting the ongoing economic uncertainty.
Policy support and energy costs in focus
The industry is looking to policy measures to stimulate demand, particularly through lead markets for low-emission steel produced in the EU. “If the public sector prioritises climate-friendly steel made in the EU, this can generate a tangible demand impulse,” Rippel said.
Energy costs remain a central concern. “Competitive energy prices are one of the most important location factors,” she emphasised, reiterating the industry’s call for a stable industrial electricity price of €50/MWh.
In this context, Rippel pointed to the European Commission’s AccelerateEU initiative as addressing “exactly the right issue” in terms of stabilising energy costs and strengthening industrial resilience.
