But in the process, the industry is struggling with economic challenges and high costs. While there is growing interest in green steel, especially from large industrial customers, there is not yet a market willing to pay more for the product. While companies are investing heavily to achieve their carbon neutrality goals, the transition to low-emission production processes is accelerating.
Green steel refers to steel produced using low-carbon emission production methods, and Europe is a leader in this area. The EU's strict regulations and sustainability targets encourage the industry to invest in green technologies. Major producers, especially in countries such as Germany, France and Italy, aim to reduce their carbon footprint by switching to methods such as electric arc furnace (EAF) and hydrogen-based production.
Nevertheless, the global green steel market continues to grow rapidly. By 2024, the market is valued at USD 4.33 billion and is expected to grow by more than 60 percent to more than USD 117 billion by 2031. Sectors such as automotive and construction are leading this green transformation and demand is expected to accelerate, especially in Europe.
However, the costs of transitioning to green steel are said to be high. Therefore, governments and the financial sector are trying to support this transformation with ESG investments. Carbon regulations and corporate social responsibility projects are among the important factors driving demand in the sector. The European Green Steel Summit held in 2024 was a critical platform for stakeholders in the industry to draw a common roadmap on this issue.
As a result, green steel is recognized as an important part of the future. However, it will take time for the market to start paying a premium for this product. Experts say that this process can be accelerated by increasing consumer awareness as well as regulations.
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