Foreign government subsidies and other market-distorting policies in the steel sector have resulted in massive global steel overcapacity – estimated by the OECD at more than 700 million metric tons, over seven times U.S. raw steel production. This overcapacity, combined with sluggish world demand and import barriers in other markets, has resulted in significant levels of steel imports entering into the U.S. market, capturing a historically-high percentage of U.S. market share and resulting in thousands of U.S. job losses and numerous plant closures throughout the steelmaking supply chain.
Of particular note, China’s steel industry remains government-owned and controlled and heavily subsidized. China continues to protect and increase its exports by manipulating its currency, raw material markets and border measures for steel and steel-containing goods. Other major offshore steel producers also continue to use subsidies, tax and trade policies, and investment restrictions to protect their markets and expand their steel production and exports. The United States must take aggressive action to combat these unfair trade practices in order to preserve and strengthen our manufacturing base.
Industry Position: Foreign government subsidies and other market-distorting policies have resulted in massive global steel overcapacity and significant levels of steel imports, resulting in thousands of U.S. job losses and numerous plant closures. The United States must press China and other nations to eliminate their steel overcapacity and to end all subsidies and other market-distorting policies that promote steel overcapacity; enforce aggressively U.S. trade laws against dumping and subsidies; respond to foreign government currency manipulation; and defend aggressively our ability to apply non-market economy methodology to remedy injurious dumping by China.