OECD Steel Committee concerned about excess capacity in steel sector | WPN World People News

Low growth prospects for the global economy, slowing demand for steel and virtually unchanged steelmaking capacity are driving severe and persistent excess capacity in the steel sector, the OECD Steel Committee said at the end of its meeting. The Committee reiterated the need for capacity reductions in relevant economies and for the removal of subsidies and other support measures that are distorting steel markets.

The Committee said that if planned new steel plants, some in regions where excess capacity is already prevalent, become operational, global steelmaking capacity could increase by 4-5% between 2019 and 2021. It called for the G20-led Global Forum on Steel Excess Capacity to swiftly implement agreed policy actions to eliminate excess capacity and market-distorting support measures, and expressed support for the continuation of the Forum’s work.

The Committee also discussed recent trade measures affecting steel and steelmaking raw materials, with several delegations expressing concern about the impact of certain trade measures on steel trade flows, as well as the effect of these measures in prompting trade measures in other jurisdictions.

The OECD Steel Committee has 25 members (Austria, Belgium, Canada, the Czech Republic, Finland, France, Germany, Hungary, Italy, Japan, Korea, Luxembourg, Mexico, the Netherlands, Poland, Portugal, the Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Turkey, the UK, the US and the EU).

In addition, four associates (Brazil, Romania, Russia and Ukraine) and seven participants (Argentina, Bulgaria, Egypt, India, Malaysia, South Africa and Chinese Taipei) bring their perspectives to the Committee’s work. A number of other economies also participate in some Steel Committee meetings as invitees.

OECD Steel Committee members, associates and participants account for around 45% of global production and 75% of global exports of steel.

Source: Organisation for Economic Co-operation and Development