Above: Chinese galvanized coils are placed onshore at a U.S. port. 

Steel trade groups see hope in G-20 talks on overcapacity

September 2016 - Nine steel groups in North, South and Latin America and Europe expressed cautious optimism Sept. 6 for the outcomes at the G-20 leaders meeting held in Hangzhou, China. 

“We are grateful that the leaders of the G-20 governments have recognized the severe impacts that global steel overcapacity in the steel sector around the world are causing to our industry,” the groups said in a statement. “This is an important first step, but it must be followed with concrete policy actions by governments to reduce excess capacity, end subsidies and government measures that distort markets, and guarantee a level playing field driven by market forces in the near term. 

“We appreciate the commitment expressed in the G-20 leaders’ statement for ‘collective responses’ to address excess capacity in the steel industry,” the groups said. “This excess capacity and the government interventionist policies that have fueled it are the root cause of the surge of steel imports being experienced in many of our home markets. 

“We are encouraged that the G-20 leaders are committed to forming a Global Forum on steel excess capacity, and that the leaders expect a continuing relationship with the Global Forum at relevant upcoming G-20 ministerial meetings.”

The groups hope all major steelmaking economies participate, and that the meetings later this week in Paris of the OECD Steel Committee will have “a substantive outcome.”

The global steel industry “is at a crossroads,” the statement reads. Governments must act “or we will remain in crisis.” The Global Forum, when created, should “define an agenda and process that will result in substantive policy actions to solve this crisis.”

A progress report is supposed to be ready for G-20 ministers next year.

The industry group includes the American Iron and Steel Institute, Eurofer, Steel Manufacturers Association, Canadian Steel Producers Association, Canacero (Mexico), Alacero (Latin America), Brazilian Steel Institute, the Committee on Pipe and Tube Imports (CPTI) and the Specialty Steel Industry of North America.