Green steel market set for rapid expansion amid technological and policy uncertainties

The global market for “green steel” is already large and, by multiple measures, set to expand sharply as industrial decarbonisation moves from pilots to commercial scale. According to the report by Fact.MR, the market is expected to rise from USD 572.97 billion in 2026 to USD 1,044.7 billion by 2036, a compound annual growth rate (CAGR) of 6.2%. The study identifies electric arc furnace (EAF) technology as the leading production route, accounting for 54.0% of market value in 2026, and flags automotive and transportation as the largest end-use at 38.0% of demand that year.

Fact.MR’s forecast is consistent with some broad industry signals: policymakers, investors and OEMs are increasing pressure on steelmakers to cut scope 1–3 emissions, and EAF routes benefit from established scrap supply chains and the relative ease of integrating renewable electricity. The report stresses regional dynamics as well, citing Asia Pacific, North America and Europe as the primary growth arenas and calling out country-level trajectories where Canada, Sweden and the United States register the strongest CAGRs through 2036 owing to abundant renewable power, early hydrogen projects and policy support.

Yet market sizing and near-term growth expectations vary widely across available studies, reflecting differing definitions of “green steel”, timeframes and methodological choices. A July 2025 study by BCC Research, reported on by GlobeNewswire, projects a much smaller base but a steeper near-term rise, from USD 7.4 billion in 2024 to USD 19.4 billion by 2029 at a 21.4% CAGR, focusing on rapidly funded project pipelines and emerging hydrogen and carbon-capture technologies. Other commercial research houses produce still different estimates: Stellar Market Research published a projection that the market could reach USD 320.7 billion by 2030 from a 2023 base of USD 2.4 billion, while Fortune Business Insights and MarkNtel Advisors report divergent figures and growth rates for 2024–2032, ranging from multi‑billion-dollar bases with double‑digit CAGRs to much larger absolute tonnes-based estimates.

Those disparities matter for procurement teams, capital planners and policy designers because they point to two realities: first, the green-steel addressable market depends critically on how buyers and certifiers define allowable feedstocks and emissions boundaries; second, the pace of technology scale-up, especially for hydrogen-based direct reduction and green-hydrogen supply chains, remains the principal source of uncertainty. Fact.MR highlights those constraints, noting high capital expenditure for hydrogen direct-reduced iron plants, limited green-hydrogen availability and variable technology maturity as meaningful restraints on adoption.

Within technology pathways, Fact.MR underscores the predominance of EAFs in the near to medium term owing to scrap availability and relative deployment speed. It also documents a complementary acceleration in hydrogen-based direct reduction projects in Europe and North America, driven by public funding and industrial partnerships. Sweden’s HYBRIT-style initiatives are cited as a model for early commercialisation, and Fact.MR points to Canada’s hydro-powered regions as particularly enabling for green-hydrogen production and large-scale direct-reduction investments. The United States is portrayed as a mixed market where established EAF capacity and federal manufacturing incentives support both EAF-led decarbonisation and nascent hydrogen projects.

Competition in the market, Fact.MR finds, is moderately concentrated. Major integrated producers such as ArcelorMittal, SSAB and thyssenkrupp AG are leading large-scale pilot and conversion programmes, while EAF-focused producers including Nucor and regional champions such as Tata Steel and China Baowu are expanding scrap-based low-carbon capacity. The study argues that commercial advantage will accrue to firms combining scale, certified low-emission product offerings and long-term offtake agreements with automotive and construction OEMs rather than to those attempting to compete solely on price.

For industrial buyers and decarbonisation professionals the practical implications are clear. Supply-chain decarbonisation strategies should distinguish between certifiable, lifecycle-assessed “fossil-free” steel versus lower‑carbon steel produced by EAFs using grid or contracted renewable power. Procurement teams will need robust product specifications, credible carbon accounting and contractual mechanisms, such as indexed premiums or long-term supply agreements, to secure volume and price certainty while supporting asset payback for producers investing in hydrogen, electrolysis capacity and renewable generation.

Policy remains a decisive lever. Fact.MR links stronger carbon pricing, Buy Clean-style procurement policies and targeted manufacturing incentives to accelerated deployment. Conversely, it warns that inadequate hydrogen infrastructure, inconsistent standards for carbon certification and uneven renewable-power availability will slow conversion timelines and raise costs.

Taken together, the evidence paints a market at an inflection point: large incumbent steelmakers are committing to multiple decarbonisation pathways; EAFs will continue to scale rapidly where scrap and power economics permit; and hydrogen-based routes will move from demonstration to deployment in regions with cheap, abundant renewable electricity and supportive policy frameworks. However, near-term market-size estimates diverge sharply between research providers, underscoring the importance for industrial buyers and investors of scrutinising assumptions about definitions, system boundaries and the timing of hydrogen and renewable-power scale-up when planning capital allocation and sourcing strategies.