The Centre for Research on Energy and Clean Air's biannual review of China’s steel sector in 2024 highlights the sector's challenges and opportunities in transitioning towards carbon neutrality. Despite China surpassing 1 billion tonnes of crude steel production annually for the fifth consecutive year, the industry faces a slump in consumption leading to severe oversupply and eroded profitability. The report underscores the necessity for a profound green transition in the steel sector to achieve carbon neutrality by 2060, aligning with China's climate ambitions. However, the overcapacity in the industry poses obstacles to low-carbon development. Key findings reveal that China is off track for its 2025 climate targets, with low-carbon steelmaking remaining below government goals. Rising steel exports present challenges amid global trade frictions, necessitating a focus on domestic demand and export strategies. To deepen the green transition, substantial reductions in BF capacity and increased adoption of green technologies like hydrogen-based metallurgy are essential. Policy recommendations include speeding up the adoption of low-carbon technologies, reducing coal-based capacity, supporting research into alternative steelmaking methods, maximizing renewable energy use, and expanding the carbon market to steel, cement, and aluminum industries. A shift towards cap-and-trade systems is proposed to achieve significant emissions reductions and drive competitiveness and sustainability in the steel sector. The report calls for industry consolidation, stricter production controls, and policies supporting innovation to facilitate a smoother transition to greener technologies, emphasizing the importance of financial incentives and international collaboration. Overall, the article outlines a roadmap for China's steel sector to achieve sustainability, competitiveness, and carbon neutrality through strategic reforms and technological advancements.