June 24, 2015
Global Steel Executives Seek Government Action Against China
Steel executives from around the globe are calling on governments to take action to curb China’s new steel policy and overcapacity issues. The consensus came out of a May meeting of the Organization for Economic Cooperation and Development Steel Committee.
Steel industry associations from Asia, the Americas and Europe agreed a new normal has taken hold in the industry, characterized by slow growth and a glut of steel imports hitting the shores of many steel-producing nations. Chinese overcapacity, supported by state-owned and supported businesses, was cited as the cause of the industry’s woes.
“Structural challenges must be addressed amid the new era of low steel demand growth and rising exports,” says Steel Committee Chairman Risaburo Nezu. “A failure to address or halt market distortions will result in subsidized and state-supported enterprises surviving at the expense of private and efficient companies operating in environments with minimal government support.”
The committee called for immediate and effective action from national governments to address the issues. One specific issue the committee cited is China’s assertion it should be treated as a market economy starting at the end of 2016. “As the steel sector in China so clearly illustrates, China does not yet meet the test of being a market economy,” Nezu says.
The associations represented in the OECD Steel Committee included the American Iron and Steel Institute, Steel Manufacturers Association, Specialty Steel Industry of North America and the Committee on Pipe and Tube Imports from the United States, the Canadian Steel Producers Association, Mexico’s Canacero, Brazilian Steel Institute, Latin America’s Alacero, Eurofer and the Turkish Steel Producers Association.