It wasn’t an auspicious start to the OECD Ministerial meeting of the Global Forum on Steel Excess Capacity in Berlin. While delegates agreed that the industry needs to dismantle government subsidies, close plants and level the playing field, the specifics were lacking.
The US government continued to attack China for not cutting back enough and said it would protect its own steel industry. Needless to say, China pushed back, saying: “Steel overcapacity is a common challenge facing countries across the world, rather than a problem unique to one country,” Li Chenggang, Assistant Commerce Minister of China.
Li said the Chinese government has taken measures in recent years to push forward the supply-side structural reform in the steel sector and successfully reduced excess capacity by over 100-million mt since 2016.
According to information shared among members of the Global Forum on Steel Excess Capacity, from 2014 to 2016, China’s capacity reduction is more than 120% of the total cut of the rest of the world.
Li emphasized, China took the lead in eliminating steel overcapacity with self-aware, proactive, determined and persistent actions, making key contributions to the development of the global steel industry.
But China doesn’t want to be the only one that is making painful efforts, “while the rest of the world just watches”, he said. Chin has a target to cut 150-million mt of excess capacity by 2020.
Meanwhile US Commerce Secretary Wilber Ross has until mid-January to make a decision on a 232 action on steel and then President Trump has 90 days to implement any recommendations.