The China Iron and Steel Association (CISA) has released its own statement in response to the joint statement of nine steel associations from America and Europe, including the American Iron and Steel Institute, the Steel Manufacturers Association, the Canadian Steel Producers Association, CANACERO (the Mexican steel association), Alacero (the Latin American steel association), EUROFER (the European steel association), Instituto AcoBrasil (the Brazil Steel Institute), the Specialty Steel Industry of North American and the US-based Committee on Pipe and Tube Imports, which had said, “The global steel industry is currently suffering from a crisis of overcapacity and the Chinese steel industry is the predominant global contributor to this problem,” while expressing their opposition to China’s market economy status, which will be automatically accorded in December 2016.
The CISA stated that it totally disagrees with the practice and viewpoints of the nine steel associations from America and Europe. It said that the Chinese steel industry, as a victim of trade protectionism, opposes the use of the steel trade as an excuse to deny China’s market economy status. According to the CISA, the step taken by the steel association lies beyond the scope of the industry associations’ work and ignores the fact that the global steel market has entered into a fully competitive period. In the scenario of serious difficulties facing the global steel industry, the nine steel associations, without any prior communications with China, released their perfunctory statement, which is not helpful at all in finding solutions, as the CISA stated.
As regards overcapacity, the CISA stated that in the last few years the Chinese government, steel industry and enterprises have taken effective measures to resolve the issue. 7.8 million mt of crude steel capacities have been eliminated and more efforts will be made to reduce capacities. At the same time, Chinese steel mills have actively cut their production in accordance with market demand. The US and European countries spent more than one decade in resolving overcapacity in the 1970s and China will take a certain period of time to do so as well, the CISA said.
In addition, the CISA noted that the increase in Chinese steel exports this year has brought about some impacts on certain countries and regions, adding that China has tried to make some adjustments. The CISA went to say that, however, it cannot be denied that the increasing exports are mainly due to market forces and competitiveness, with Chinese steel products being popular in export destinations, bringing benefits for many consumers.