U.S. surpasses Japan to become third-largest steel producer in a post-pandemic recovery driven by tariffs and demand surge

The United States has overtaken Japan to rank as the third-largest global steel producer in 2025, boosted by new tariffs, rising domestic demand, and government initiatives, signalling a significant shift in the global steel landscape.

U.S. crude steel output rose in 2025 to 82 million tonnes, vaulting the United States past Japan to become the world’s third-largest steel producer for the first time since 1999, according to the World Steel Association. The association...

Policy changes implemented by the administration are being credited for much of the recovery. In February 2025 the White House announced tariffs on imported steel and aluminium, initially set at 25% and subsequently raised to 50%, measures intended to curb imports and bolster domestic production. Government figures and industry observers say the levies contributed to a marked fall in foreign shipments into the U.S., with import share of apparent steel consumption reportedly shrinking from roughly 25% to about 14% by November.

Beyond trade policy, demand drivers helped lift output. Industry reporting highlights substantial construction of data centres to support artificial intelligence workloads, as well as investment in power‑generation projects, as important sources of new steel demand last year. Those factors, together with higher domestic shipments, supported production across multiple mill types.

The tariffs have also been linked to rising prices. Market data show hot‑rolled coil prices climbed sharply, reaching about $983 per tonne by 12 January, nearly double prevailing global export levels, a development producers say has improved margins for U.S. mills.

Producers and executives have pointed to the measures as beneficial for domestic manufacturing. Speaking during a company earnings call, Nucor chief executive Leon Topalian said, “… the demand, the robustness that we see in this economy, again, I think 2026 is shaping up to be a very, very solid year for Nucor.” The comment was made to investors during the firm’s results briefing.

The White House framed the tariffs as part of a broader effort to reduce reliance on foreign suppliers and to address global excess capacity that has depressed prices and displaced production in some markets. Industry groups supportive of the moves argue they have revived idled capacity and encouraged fresh investment in U.S. facilities. Critics warn higher import duties can feed through to elevated costs for downstream manufacturers and consumers.

Internationally, China and India remain the largest steel producers by volume, with the U.S. reclaiming third place. Analysts note the ranking change reflects both growth in American output and stagnation or slower expansion in other advanced economies, including Japan.

As 2026 begins, steel sector observers will watch whether the mix of protectionist measures, surging demand for AI infrastructure and energy projects, and elevated prices sustains higher U.S. production or whether market adjustments and diplomatic or trade responses elsewhere alter the trajectory.

Source: Noah Wire Services