In 2024, China's steel industry faced the paradox of high production levels alongside a decline in consumption, causing overcapacity and maintaining high carbon intensity due to coal reliance. The sector is under pressure at the corporate level from factors like green steel premiums and international tariffs, hindering low-carbon investments. To address these challenges and align with its peak carbon and carbon neutrality goals, China introduced policies to manage carbon emissions and prioritize steel production control and capacity reduction. Notably, the government is actively supporting the adoption of hydrogen metallurgy for steel production, aiming to shift from carbon to hydrogen as the reduction agent. As China approaches the end of its 14th five-year plan, the focus shifts towards steel decarbonization and positioning as a global leader in green steel production. Key areas of emphasis include leveraging green hydrogen and renewable energy sources to reduce carbon emissions in steel manufacturing. By promoting electricity-based steel production methods and utilizing resources like scrap steel and green hydrogen, China aims to transition towards a fully low-carbon steel production process, paving the way for a sustainable future in the industry.