This paper examines the extent, reasons and impacts of excess capacity in the global steel industry, as well as the implications of new investment projects that continue to take place at a rapid pace in many parts of the world. By focussing on new investments projects taking place in the global steel industry, this study intends to help governments and industry better understand the extent to which global steelmaking excess capacity may evolve in the future. The paper finds that global steelmaking capacity will continue to expand, with regions that are currently net importers of steel products expected to record the largest capacity increases. Global nominal steelmaking capacity is projected to increase to 2.36 billion tonnes by 2017, up from 2.16 billion tonnes in 2013. Non-OECD economies will continue to lead the capacity expansion in the global steel industry, with their share of world capacity expected to increase to 71.4% by 2017. Of particular importance for governments in this context will be to work towards removing market distorting policies such as subsidies that promote the emergence of new capacity or delay the closure of failing companies.