The steel industry overcapacity has always been a time bomb

China's steel demand and Production

Despite China’s signal to reduce its excess steel production capacity, industry executives said, the country has declared a “war” metal, has produced a “devastating” to the rest of the world industry.
The steel industry overcapacity in recent years has been the industry side time bombs, driving prices down, make some steel & steel pipes enterprises difficult to survive.
China’s low cost metal producers has been widely quoted as the main reason for the excess. In particular, the world’s second-largest economy was accused of “dumping” cheap steel & steel pipes into the global market, to gain market share, because of the slowdown in domestic demand. But Beijing has denied any wrongdoing and said its cost is lower than other manufacturers.
This is war, not trade
Other countries, including India, Italy, South Korea and Taiwan, also considered contribution to the global steel surplus. Export said, every country has its own set of subsidies and problems, “caused a lot of problems, dumping steel in the international market.
However, similar to the oil industry, despite the falling demand, some manufacturers in order to support prices in 2015 before slowing production progress has been slow.
In addition, it says, the oecd economies such as China is expected to lead to the global steel industry capacity expansion, its share in the world ability is expected to increase by 2017 to 71.4%.
There is no sign that the global iron and steel production in the short term is slowing down.
According to the world steel association statistics, in March 2016, the global crude steel production is 385.7 million tons, down 3.6% compared with the same period in 2015, China’s crude steel production in March, 2016 to 70.7 million tons, up 2.9% in March 2015. In March 2016 of India’s crude steel output of 8.1 million tons, a 3.4% growth in March, 2015.
Export said, “just according to the Numbers, China is by far the biggest problem”, accusing China of not complying with the international trade rules. “If your competitiveness is based on deception international trade rules, you can’t call it their own competitiveness. There is no trade is not fair, but the war.
Source: Zhejiang Yaang Pipe Industry Co., Limited (www.yaang.com)

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