China's steel industry: navigating the shift from scale to quality

As the 14th Five-Year Plan (20212025) nears completion, China's steel industry is at an inflection point. Having long relied on scale and rapid output growth, the sector is transitioning toward higher quality, greener operations, and greater technological sophistication. This shift reflects not only policy direction but also deeper changes in China's economic structure, resource-security strategy, and global demand patterns.

Over the past five years, the industry has made meaningful progress in capacity control, decarbonization, digitalization, and product innovation. Yet key targets remain unmet: raising the electric-arc furnace (EAF) share to 15%, lifting R&D intensity to 1.5%, and closing gaps in high-end specialty steels. Meanwhile, downstream demand is rebalancing,