Manufacturing alliance calls for Washington to curtail Chinese steel production

A major national manufacturing trade association has placed Washington and Beijing on call over China’s steel overcapacity.

While the Alliance for American Manufacturing (AAM) applauded U.S. Treasury Secretary Jack Lew for asking China to cut back on excessive steel overcapacity this week, the organization also pointed out that promises and actions have been two different things when it comes to the Chinese steel industry.

“Today’s message can’t come soon enough – China needs to stop overproducing steel,” said AAM President Scott Paul. “China’s massive overcapacity has corroded our steel sector, and I commend Secretary Lew’s strong push to end the global steel glut, but I’m not placing my hope in China. For years Beijing has promised to stop overproducing, but every year those promises fall flat.”

Paul said production has continued to grow despite an announcement in 2009 that China planned “to cut its steel production from the previous year’s output of 521 million tons to 460 million,” the AAM stated in a press release, adding that the plan was “to let production rise from that 460 million-ton baseline to 500 million tons in 2011.”

The statement continued: “Instead production jumped to 577 million tons in 2009, and passed 700 million tons in 2011. … In 2015 alone, China produced over 800 million tons of steel – roughly half the world’s steel production.”

What this means for the steel sector in the United States, Paul said, is that “nearly 15,000 U.S. steelworkers are currently paying the price with their jobs.”

“It is clear that China can’t be believed on its word alone and it is time for Washington to hold Beijing accountable for its actions by enforcing fair trade laws and demanding an end to China’s industrial overcapacity,” Paul said.

The AAM has a year-by-year breakdown for how overcapacity has risen since 2009 which can be viewed at this link.