Steel Trade Associations Urge Strong Action on Overcapacity

SEATTLE (Scrap Monster): A joint statement released by nineteen steel industry associations across the Americas, Europe, Africa and Asia has urged the governments of steelmaking economies to take urgent action to effectively tackle the overcapacity crisis in the global steel sector.

The steel industry groups noted that governments should devise and implement strong rules and remedies towards reducing excess steel capacity. To this effect, the governments should use all available mechanisms and negotiation forums, including the G20 Global Forum on Steel Excess Capacity.

The primary demands of the associations include actions to eliminate market-distorting subsidies and similar supportive measures, stronger international rules against subsidies, more robust mechanisms to ensure exit of inefficient firms. Further, the associations also called for enhanced transparency and co-operation.

The letter commended the recent statement issued by the Organization for Economic Cooperation and Developments’s (OECD) Steel Committee, which had expressed concerns with regards to unexpected growth of new steelmaking facilities. The Committee had demanded for extension of G20 Global Forum on Steel Excess Capacity past 2019.

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The steel industry associations noted that actions to remove capacity reduction have not been adequate to date. The government efforts to eliminate practices that result in excess capacity should be redoubled, they said.