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Major steel producers fail to reach deal on overcapacity

Major steel producers fail to reach deal on overcapacity

BRUSSELS: China and other major steel-producing countries failed to agree measures to tackle a global steel crisis as the sides argued over the causes of overcapacity, prompting US criticism of Beijing’s app­roach and an angry response from Chinese officials.

A meeting of ministers and trade officials from over 30 countries, hosted by Belgium and the OECD on Monday, sought to tackle excess capacity, but concluded only that it had to be dealt with in a swift and structural way.

Washington pointed the finger at China over the failure of the talks, saying Beijing needed to act on overcapacity or face possible trade action from other countries.

“Unless China starts to take timely and concrete actions to reduce its excess production and capacity in industries including steel … the fundamental structural problems in the industry will remain and affected governments including the United States will have no alternatives other than trade action to avoid harm to their domestic industries and workers,” US Secretary of Commerce Penny Pritzker and US Trade Representative Michael Froman said in a statement.

Asked what steps the Chinese government would take following the unsuccessful talks, China Commerce Ministry spokesman Shen Danyang told reporters on Tuesday: “China has already done more than enough. What more do you want us to do?”

“Steel is the food of industry, the food of economic development. At present, the major problem is that countries that need food have a poor appetite so it looks like there’s too much food.”

The OECD said global steelmaking capacity was 2.37 billion tonnes in 2015, but declining production meant that only 67.5 per cent of that was being used, down from 70.9 per cent in 2014.

Britain in particular has felt the squeeze as its largest producer Tata Steel has announced plans to pull out of the country, thre­atening 15,000 jobs. Last week, more than 40,000 German steel workers took to the streets to protest against dumping from China.

China, the world’s top steel producer, has been ramping up exports of steel in recent years, as it battles to steer its economy into services led growth and away from traditional manufacturing, while keeping employment levels high.

China’s steel exports jumped 30pc from a year ago to 9.98m tonnes in March despite a slew of anti-dumping measures globally.

But blaming China for woes in the global steel industry is simply a lazy excuse for protectionism, and such finger-pointing will be counter productive, China’s official Xinhua news agency said in a commentary on Monday.

Courtesy : Dawn News



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