Asia-Pacific is already the world’s centre of gravity for steel, producing and consuming more of it than any other region, with demand still climbing towards 2030. That scale is exactly why the region matters so much to steel decarbonisation. In this session of our bi-monthly #GreenSteel62 virtual learning forum, we looked beyond Europe’s carbon border and procurement rules to ask a different question: can Asia-Pacific build its own credible market for green steel?
Drawing on new regional research, our speaker unpacked where near-zero emissions steel demand is really coming from, how big the gap is between that demand and the region’s supply pipeline, and what buyers, producers and governments each need to do to close it.
What we discussed
- Asia-Pacific is not a side story: Steel demand discussions often centre on Europe, driven by mechanisms like the EU’s Carbon Border Adjustment Mechanism. But Asia-Pacific’s own scale of production and growing consumption, including in Indonesia, make it central to the sector’s decarbonisation. The question is whether that growth becomes a lever for industrial upgrading and competitiveness, or another cycle of carbon-intensive lock-in.
- Where demand is coming from: Across seven focus countries (Japan, South Korea, Vietnam, Indonesia, Malaysia, the Philippines and Thailand), corporate climate commitments point to around 6 million tonnes a year of potential near-zero steel demand by 2030, roughly half of it from the automotive sector, with construction, shipping, machinery and appliances making up the rest. Smaller but higher-paying pockets of demand are also emerging from data centres, offshore wind and battery electric vehicle production.
- Public procurement as a market-making lever: Governments across the focus countries procure an estimated 45 million tonnes of steel a year. Aligning even a portion of that volume with national climate targets could add around 11.5 million tonnes of annual near-zero steel demand, a signal large enough to give producers the confidence to invest. In Indonesia specifically, government demand is mostly embedded in construction contracts rather than direct steel purchases, which means procurement policy needs to reach contractors, not just steelmakers, to be effective.
- Turning demand signals into deals: Green premiums for near-zero steel remain high, RMI estimates 20–35% versus conventional blast furnace steel, though the pass-through to end products like cars or buildings is usually small. Closing that gap will take a mix of tools: policy support such as Japan’s Clean Energy Vehicle Tax Credit, mechanisms like book-and-claim that let buyers purchase the environmental attribute of green steel without navigating long supply chains, and aggregated buyer platforms, like RMI’s Sustainable Steel Buyers Platform, that pool demand to give producers a bigger, clearer signal to build against.
Key takeaways
- Asia-Pacific’s steel demand is not a side story in the global transition, it is central to it, and Indonesia is part of that growth.
- Corporate climate commitments already point to real near-zero steel demand, but the region’s clean supply pipeline is far behind what is needed to meet it.
- Much of the green steel currently sold in the region uses standards that reward incremental efficiency gains rather than deep decarbonisation, a risk buyers need to price in.
- Public procurement could unlock a significant new demand signal, but in Indonesia this means engaging contractors and construction policy, not just direct steel purchases.
- Tools like book-and-claim mechanisms and aggregated buyer platforms can help overcome fragmented, opaque supply chains and long-standing intermediary relationships.
- Closing the green premium will require a mix of buyer education, standardised carbon accounting, and stronger policy support beyond the current momentum in Japan and Korea.
Watch the webinar
Speaker
Ariane DesRosiers: APAC Regional Engagement Lead, RMI (Rocky Mountain Institute). Ariane is a co-author of RMI’s Asia-Pacific’s Green Steel Demand Opportunity report and works on RMI’s Sustainable Steel Buyers Platform. In this session, she presented the report’s key findings on where near-zero steel demand is emerging across the region, the barriers standing between that demand and a bankable market, and how buyer platforms and public procurement can help close the gap.
The Green Steel 62 series is a bi-monthly virtual learning forum for stakeholders working on steel decarbonisation in Indonesia. Each 62-minute session brings together international expertise and local insight to exchange ideas, share research, and strengthen collaboration. To find out about upcoming sessions or get in touch, contact suka@climatecatalyst.org
