Downstream industries' plans for steady growth are being released one after another—what changes are emerging in steel demand?
Recently, the Ministry of Industry and Information Technology, the National Development and Reform Commission, the National Energy Administration, the Ministry of Natural Resources, the Ministry of Ecology and Environment, the Ministry of Housing and Urban-Rural Development, the Ministry of Water Resources, and other departments have successively issued the Work Plan for Steady Growth in Downstream Steel-Using Industries (2025–2026), actively promoting its implementation. These policy measures have drawn widespread attention within the steel and steel product trading sectors. Industry insiders generally believe that, as these initiatives are put into practice, downstream demand for steel is expected to further rebound.
Steel demand in the machinery manufacturing industry remains steady with a gradual increase.
On September 29, the Ministry of Industry and Information Technology, along with five other departments, jointly issued the "Work Plan for Steady Growth in the Machinery Industry (2025–2026)," which outlines the goal of maintaining stable and positive momentum in the machinery sector from 2025 to 2026. The plan aims for an average annual growth rate of around 3.5% in operating revenue, with total revenue expected to surpass 10 trillion yuan.
The plan clearly outlines accelerating the construction of major projects under the nation's 14th Five-Year Plan, while also initiating planning for significant projects during the 15th Five-Year Plan period. This will continuously drive innovation and development in agricultural machinery, construction equipment, rail transit systems, medical devices, and other industries. Additionally, the plan emphasizes speeding up initiatives like urban village redevelopment, city renewal, renovation of older residential communities, and the rollout of smart parking facilities—projects that directly benefit the public—and thereby boosting demand for construction machinery, rail transit equipment, general-purpose machinery, and logistics solutions.
Implement an action plan to upgrade and transform railway equipment, boosting demand for rail transit systems, construction machinery, and intelligent inspection equipment. Leverage policies such as subsidies for agricultural machinery purchases and applications, as well as scrappage and renewal incentives for agricultural machinery, to accelerate the adoption and promotion of advanced, highly effective agricultural equipment. Additionally, roll out the implementation plan for equipment upgrades in the healthcare sector, supporting the procurement of cutting-edge medical devices and facilitating the replacement of outdated equipment with state-of-the-art models.
In terms of reliability enhancement, the plan proposes implementing the "Foundation Building" project for basic product reliability and the "Reliability Doubling" project for complete equipment and systems, thereby boosting the reliability levels of critical components and high-end complete machinery.
Industry insiders believe that steel consumption in the machinery sector in 2025 is expected to exhibit three key characteristics: First, there will be a relatively stable market demand for large-scale, high-quality castings and forgings in areas such as power generation equipment, petrochemical machinery, and metallurgical equipment. Second, demand for high-strength steel in sectors like construction machinery and mining machinery is set to rebound. Third, demand for premium special steels and specialized alloys used in advanced equipment is trending upward. Looking ahead, the drive toward intelligent and green development will place even higher demands on steel properties such as precision, wear resistance, and corrosion resistance. Meanwhile, emerging fields like new-energy equipment and new-energy vehicles are creating growing needs for high-end pressure vessel steels, lightweight materials, high-strength automotive body steels, and high-performance non-oriented steels. Silicon steel Demand for it is increasing.
Industry insiders predict that steel demand in the machinery manufacturing sector will reach approximately 179 million tons in 2025, representing a 1% year-on-year increase. Key drivers include accelerated infrastructure development, the expanding application scope of high-speed steel, and supportive government policies.
The green transformation of the construction materials industry drives steel upgrades.
On September 24, the "Work Plan for Steady Growth in the Building Materials Industry (2025–2026)," jointly issued by six departments including the Ministry of Industry and Information Technology, the Ministry of Natural Resources, and the Ministry of Ecology and Environment, proposed that by 2026, green building materials will generate more than 300 billion yuan in revenue, with significant improvements in green, low-carbon, and digitalization development levels.
The plan clearly outlines accelerating green and low-carbon transformations, promoting the substitution of clean energy for industrial furnaces and kilns, building green factories, advancing the application of green building materials, and increasing subsidies for green building materials.
The green transformation of the construction materials industry is placing higher demands on steel. For instance, high-strength reinforcing bars and Structural steel On the structural side, high-strength reinforcing bars ranging from 500 MPa to 650 MPa and steel plates rated Q345GJ to Q690GJ exhibit excellent mechanical and seismic performance, making them suitable for use in super-tall buildings. H-shaped steel Widely used in the manufacturing of critical structural components such as beams and columns for steel-frame residential buildings, it enhances construction efficiency and spatial flexibility. Fire- and weather-resistant H Steel Profiles , Z-direction high-strength steel and other materials are suitable for constructing large-scale public facilities and industrial plants, offering fire-resistant and earthquake-resistant properties.
Steel demand in the automotive industry is shifting toward Special Steel Transformation
On September 13, the "Work Plan for Steady Growth in the Automotive Industry (2025–2026)," jointly issued by eight departments including the Ministry of Industry and Information Technology, proposed that by 2025, the industry aims to achieve annual auto sales of around 32.3 million vehicles, representing a year-on-year increase of approximately 3%. Among these, new-energy vehicle sales are expected to reach about 15.5 million units, marking a growth of roughly 20% compared to the previous year.
The plan clearly outlines expanding the new energy vehicle market, accelerating the electrification of vehicles in the public sector, stepping up support for trade-in programs that encourage consumers to upgrade their cars, and boosting the development of charging and battery-swapping infrastructure.
Industry insiders say the "steel demand" structure in the automotive manufacturing sector is undergoing a transformation. While conventional fuel vehicles typically use around 900 kilograms of steel per vehicle, new-energy vehicles are leveraging lightweight designs to reduce steel usage by 15% to 20%. As a result, the proportion of high-strength steel used in new-energy vehicles has risen significantly—from 30% to 40% to 50%. Meanwhile, battery pack housings are made from DP980 dual-phase steel, and motor shafts are crafted using GCr15 material. Bearing steel Specialty steel grades have unit prices higher than those of ordinary steel. In addition, Aluminum The use of alloys in body panels such as car doors has led to a decline in demand for low-carbon steel, yet high-strength steel remains the primary material for manufacturing chassis and vehicle body frames—mainly because its cost is only one-third to one-half that of aluminum alloys, while offering superior recyclability.
The petrochemical industry's material demands are moving toward higher standards.
On September 2, 2025, the "Work Plan for Steady Growth in the Petrochemical and Chemical Industry (2025–2026)," jointly issued by seven departments including the Ministry of Industry and Information Technology, the Ministry of Ecology and Environment, and the Ministry of Emergency Management, outlined that from 2025 to 2026, the added value of the petrochemical and chemical industry will grow by more than 5% annually on average, while economic performance stabilizes and rebounds, and the industry's capability for technological innovation will be significantly enhanced.
The plan clearly outlines efforts to strengthen high-end supply by supporting research and development of critical products such as electronic chemicals and advanced polyolefins. It also calls for implementing safety upgrades, backing comprehensive renovations and enhancements of aging equipment, and accelerating the transition to fully automated processes or low-risk alternatives for key hazardous technologies under stringent regulatory oversight.
The steel used in the petrochemical industry is characterized by a wide variety of grades, diverse specifications, and stringent quality requirements, primarily focusing on special steels with high strength, corrosion resistance, and high-temperature durability—materials essential for applications such as pressure vessels, pipelines, and heat-exchange equipment.
Specifically speaking, Stainless steel Seamless Steel pipe (Such as 304, 316, 316L, etc.) are widely used in the manufacturing of material-conveying pipes, heat exchanger tubes, and more—materials that must possess properties like resistance to chloride-ion corrosion and high-temperature oxidation. CrMo steel and duplex steel, meanwhile, are commonly employed in pressure vessels and deep-sea oil-and-gas extraction equipment, where they need to withstand extreme pressures and temperatures.
In terms of applications, demand for oil and gas pipelines has increased, while the fertilizer industry is urgently seeking large-diameter, thick-walled pipes.
In the future, as the petrochemical industry undergoes a green transformation, its demand for materials that are corrosion-resistant, high-strength, and capable of withstanding extreme environments will continue to grow.
First, for materials used in crude oil processing and coal chemical equipment within the future petroleum, petrochemical, and coal-to-chemicals industries, it is recommended to use low-alloy steel that has undergone normalizing (with rapid cooling permitted) followed by tempering.
Second, to address the demand for materials used in equipment operating under ultra-high-temperature conditions in the petrochemical industry, it is recommended to adopt materials capable of withstanding temperatures ranging from 500°C to 800°C. Nickel Base alloy material.
Third, for equipment operating in low-temperature or ultra-low-temperature environments, high-alloy steel materials can be selected.
Demand for high-end steel in the power equipment industry is increasing.
On September 12, the Ministry of Industry and Information Technology, the State Administration for Market Regulation, and the National Energy Administration jointly issued the "Work Plan for Steady Growth in the Power Equipment Industry (2025–2026)," which outlines that from 2025 to 2026, the annual revenue growth rate of traditional power equipment will remain around 6%, while exports of new-energy equipment are expected to increase.
The plan clearly outlines accelerating the development of large-scale onshore wind and photovoltaic power bases, as well as promoting the orderly and regulated construction of offshore wind farms. It also emphasizes continuing to implement the "three upgrades linked together" for coal-fired power plants, actively and steadily advancing major hydropower projects, and proactively and efficiently developing pumped-storage hydroelectric facilities while steadily pushing forward nuclear power development.
The steel demand in the power equipment industry continues to grow, driven primarily by rising electricity consumption, the expansion of the new energy sector, and increasing demand for high-end products. Notably, the rapid development of industries such as new-energy vehicles, wind power, and photovoltaics has boosted the demand for electrical steel, among other materials. Medium-to-thick plates Steel demand is expected to rise; high-end equipment such as ultra-high-voltage transformers and hydroelectric generator sets are driving increased demand for high-magnetic-permeability electrical steel and thin-gauge steel products.
Overall, the implementation of the stable growth plan for the downstream steel-using industries will help shift steel demand from quantitative expansion to qualitative improvement. It is recommended that steel companies closely align with policy directions, optimize their product portfolios, and strengthen R&D efforts to continuously meet the transformation and upgrading needs of downstream industries.
