Abstract: Starting from the physical essence of the dynamic operation of steel manufacturing processes, the physical essence of low-carbon development in the steel industry was discussed, namely, the rational construction of the dissipation structure and the optimization of the dissipation process in the operation process of manufacturing process, supply chain and service chain. And it is believed that low-carbon development in the steel industry is a systematic proposition that needs to be addressed not only from specific procedures/devices, but also from process structures, process functions, process efficiency, etc. Furthermore, based on the analysis of CO₂ emission status of steel industries of China and the world, a scenario analysis model of carbon peaking and carbon neutralization in China's steel industry was built. Through the scenario analysis, the contribution of major carbon reduction measures to CO₂ emission reduction was quantitatively analyzed. It was pointed out that in the process of achieving carbon peaking and carbon neutrality in the steel industry, the cumulative emission reduction contribution of crude steel production control was about 45%, and the orderly and reasonable utilization of scrap accounted for about 39%, the hydrogen reduction technology accounts for about 9%, and factors such as energy conservation, "interface" technology, and smart manufacturing account for about 7%. At the same time, the idea of a low-carbon development roadmap for China′s steel industry and three stage development goals of carbon peak platform period, decarbonization, and carbon neutrality were proposed. And the future development prospects of the steel industry were looked at from the perspectives of resource decarbonization, energy decarbonization, and process decarbonization. It was shown that by 2060, the consumption of iron ore in China′s steel industry is expected to decrease by 75%, and the utilization of scrap will increase by 89%; the coal consumption is expected to decrease by 92%, and the fluctuation in electricity consumption is relatively small, while the amount of hydrogen used may reach 14 million t/a; the proportion of BF-BOF process is about 15%, EAF process is about 60%, and hydrogen reduction-EAF process is about 25%. Finally, assumption of three types of manufacturing processes in the future steel industry were proposed, namely BF-BOF process, full scrap EAF process, and hydrogen reduction-EAF process.