China must slash steel output to meet 2025 decarbonisation goals
China needs to cut steel production from coal-powered blast furnaces by over 90 million metric tons from 2024 levels to meet its 2025 green steel targets, according to a report published on Tuesday by the Helsinki-based Centre for Research on Energy and Clean Air (CREA).
Analysts say meeting the goal of producing 15% of steel through electric arc furnace (EAF) technology could reduce CO2 emissions by more than 160 million tons, almost matching the entire carbon footprint of the European Union's steel sector, News.Az reports, citing Reuters.
Despite being the world’s largest steel producer — responsible for over half of global output — China lags behind other countries in the adoption of cleaner EAF technology. Globally, EAF accounts for 30% of steel production, compared to just 10% in China. By contrast, the share is 71.8% in the United States, 58.8% in India, and 26.2% in Japan, CREA reported.
“A credible strategy to curb emission-intensive production and rein in excess capacity would not only tackle the sector's structural issues but also ease global tensions,” said CREA analyst Belinda Schaepe.
China produced 1.005 billion tons of crude steel in 2024, 90% of which came from blast furnaces. The sector’s overcapacity has depressed global steel prices and led to growing trade tensions over surging exports. EAF technology, however, has struggled in China due to high power costs, unstable scrap supply, and rising financial losses.
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