Within the last week, Australia, the EU, and the US have rolled out trade protective measures on importing steel, with many placing the blame for overcapacity on China.
According to China's Ministry of Commerce, since 2015, about 55 cases on steel products were brought against China from Western countries, involving volumes worth over US$8 billion.
Steel prices have increased 20 percent since the beginning of the year. An economic revival is stimulating demand globally while increased prices for iron ore are boosting costs.
Domestically, by reducing overcapacity and pushing consumption. Ministry of Commerce spokesperson Shen Danyang says infrastructure projects have supported the demand.
"China has been cutting off the overcapacity with remarkable efforts, and has been taking actions, so the results are gradually showing. Meanwhile, China will take comprehensive measures to broaden the consumption area of steel. They have brought positive expectations to the steel market, and caused the price increase," said Shen Danyang, spokesperson of Chinese Ministry of Commerce.
China plans to cut the production of crude steel by 100 million to 150 million tons in five years, which will result in job replacements for 500,000 people. However, not everyone is seeing this positively.
"Western countries think 150 million tons are too little and that five years are too long. I think it's not about too much and to little. It's an issue that needs joint efforts by all countries in the world. Every country has its own conditions, and you should act in view of those conditions," said Wang Liqun, Vice Chairman of China Iron and Steel Association.
"The blame Europe and the US put on China over steel is a way to shift conflicts. It's because they themselves can't find a way out that they blame China, asking China to cut overcapacity while doing nothing themselves. I think their way of doing things will cause them to miss the opportunity to adjust the industry and only postpone their problem," said Wang Hejun, Chief of Trade Remedy & Investigation Bureau, Ministry of Commerce.
Recently, an international seminar on steel industry was held in Brussels, trying to offer a remedy to global steel overcapacity. It was jointly held by Belgium and the Organization for Economic Cooperation and Development.
"This OECD meeting was effective, allowing global steel-producing countries to work together to cut overcapacity," said Wang Liqun.
At the press conference, Ministry of Commerce spokesperson Mr. Shen Danyang also urged other countries to help guide the steel sector through these tough times.
Thankfully, demand for steel in China has picked up this year, but some say it's too early to celebrate, as it’s still unclear how long the higher steel prices will last.
