(Note: Joint press release by 19 Regional and National Steel Associations is below the EUROFER press release
Brussels, 22 October 2019 – The European Steel Association (EUROFER) has today issued a joint release alongside eighteen other regional and national steel associations calling for the Global Forum on Steel Excess Capacity to be extended. At the same time, the crisis in the European steel industry – largely a result of the very overcapacity the Global Forum exists to fix – continues to intensify.
“Europe-based steelmakers and those in their partner regions across the whole world are making it clear today that they believe the extension of the Global Forum on Steel Excess Capacity is essential to effectively reduce global production overcapacity in the sector”, said Axel Eggert, Director General of EUROFER.
The Global Forum was established in late 2016, on the instruction of G20 Leaders. It set out to gather information and report on the evolution of steel supply and demand conditions, steel production capacity, and government policies that lead to global overcapacity, such as subsidies. The Forum’s work has already produced results, such as detailed statistics on steel capacity and production around the world and has instigated work to cut excess capacity where it is needed.
“Meanwhile, the impact of this overcapacity is causing ructions around the world. The trade wars being waged, and the resultant rise of protectionist measures affecting products well beyond our sector, has steel overcapacity at its root”, emphasised Mr Eggert.
“Even with the EU Steel Safeguard in place, the EU is having a torrid time. Apparent demand for steel is expected to fall by 3.1% in 2019, even as imports surge in often violently unpredictable ways. We therefore ask the EU Commission to further strengthen the safeguards.”, added Mr Eggert.
Steel imports into the EU rose by 12% in 2018, to the highest recorded level. Today, imports are still well above the 2016 & 2017 levels, which were themselves records at the time. Surges are at least as damaging as sustained high import levels, and the EU saw a 50% drop in total finished steel imports in June 2019, followed by a 50% rise in July when the new safeguard quota period opened.
“Overall global steel overcapacity has fallen only slowly in the past few years, if only because China, in particular, is ramping up production – up 9.1% in the 8 months to August 2019, even as production in Europe has fallen by 2.9%, and in the majority of other regions is also flat or declining. Global overcapacity still stands at some 500 million tonnes and the OECD expects it to rise again in 2020”, stressed Mr Eggert. “This is a deepening crisis which has already seen a number of European steel plants idled or closed, with thousands of steel workers being laid-off over the past year”.
“We call for the Global Forum on Global Excess to have its mandate extended – and for it to continue vigorously for the foreseeable future, either with all members or with the supportive members of the international community”, concluded Mr Eggert.
Notes for Editors
Charles de Lusignan, Spokesman & Communications Manager, +32 2 738 79 35, firstname.lastname@example.org
A PDF of this Press Release is available: here
This manifesto sets out the footprint and importance of European steel to the EU economy, and explains why we need to make the industry more innovative, skilled and sustainable while also ensuring there is a robust trade policy that defends the sector against the challenges posed by overcapacity and trade surges. The manifesto can be downloaded: here
The EU put in place a safeguard in the wake of the US’ decision to impose a 25% tariff on all steel product imports into the US. This action, when seen in the context of massive global steel production overcapacity, risked causing massive deflection of steel volumes to the EU market, which an open market. Imports surged in 2018, rising by 12%. This infographic explains how the safeguard works and identifies some of the problems with it. The images are below and a PDF version can be downloaded: here
About the European Steel Association (EUROFER)
EUROFER AISBL is located in Brussels and was founded in 1976. It represents the entirety of steel production in the European Union. EUROFER members are steel companies and national steel federations throughout the EU. The major steel companies and national steel federations in Switzerland and Turkey are associate members.
About the European steel industry
The European steel industry is a world leader in innovation and environmental sustainability. It has a turnover of around €170 billion and directly employs 330,000 highly-skilled people, producing on average 160 million tonnes of steel per year. More than 500 steel production sites across 22 EU Member States provide direct and indirect employment to millions more European citizens. Closely integrated with Europe’s manufacturing and construction industries, steel is the backbone for development, growth and employment in Europe.
Steel is the most versatile industrial material in the world. The thousands of different grades and types of steel developed by the industry make the modern world possible. Steel is 100% recyclable and therefore is a fundamental part of the circular economy. As a basic engineering material, steel is also an essential factor in the development and deployment of innovative, CO2-mitigating technologies, improving resource efficiency and fostering sustainable development in Europe.
Nineteen steel industry associations in the Americas, Europe, Africa and Asia today called for the governments of steelmaking economies to step up efforts to effectively tackle persistent global excess capacity in the steel sector, including by quickly implementing strong rules and remedies that reduce excess capacity, its impact and its causes. The industry groups emphasized that governments should use all available mechanisms and negotiation forums, including the G20 Global Forum on Steel Excess Capacity, to:
The industry groups commended the September 30, 2019 statement by Ulf Zumkley, Chairman of the Organization for Economic Cooperation and Development’s (OECD) Steel Committee, which expressed grave concerns about the unexpected growth of new steelmaking facilities in 2019, exacerbating global excess capacity and contributing to trade tensions. Participants in the OECD Steel Committee reiterated the need for further capacity reductions in relevant steel-producing economies and urged members to extend the G20 Global Forum on Steel Excess Capacity past its current expiration in 2019.
“We are grateful for the efforts made to date by the G20 and OECD governments to address excess capacity, and to support a playing field at the G20 Global Forum on Steel Excess Capacity and OECD Steel Committee,” the industry groups said. “Unfortunately, effective reductions in capacity and concrete actions to remove government measures that distort markets, including raw materials markets, have not been adequate to date. Efforts by governments to eliminate practices that lead to excess capacity should be redoubled. We are hopeful that the diligent efforts of Japan, the current G20 Chair, are successful in extending the G20 Global Forum on Steel Excess Capacity beyond 2019, and we urge all G20 and OECD steelmaking economies to pursue all vigorous means to obtain substantive results on the critical problem of steel excess capacity.”
The steel industry groups issuing the call for urgent action include representatives of: Steel Manufacturers Association (SMA), American Iron and Steel Institute (AISI), EUROFER (European Steel Association), Canadian Steel Producers Association (CSPA), CANACERO (the Mexican Steel Association), Alacero (the Latin American Steel Association), Brazil Steel Institute, Turkish Steel Producers Association, Republican Association of Mining and Metallurgical Enterprises (AMME), The Japan Iron and Steel Federation (JISF), European Steel Tube Association (ESTA), Korea Iron and Steel Association (KOSA), Specialty Steel Industry of North America (SSINA), South African Iron and Steel Institute (SAISI), The Cold Formed Steel Bar Institute (CFSBI), Association of Enterprises UKRMETALURGPROM (Ukraine), Russian Steel Association, Indian Steel Association, and The Committee on Pipe and Tube Imports (CPTI).
SMA – Phil Bell, email@example.com, 202.296.1515
AISI – Lisa Harrison, firstname.lastname@example.org, 202.452.7115
CSPA – Catherine Cobden, email@example.com, 613.238.6049
CANACERO – Salvador Quesada, firstname.lastname@example.org, 52 (55) 5448-8162
EUROFER – Charles de Lusignan, email@example.com, 0032 2738 79 35
Alacero – Fernanda Valente, firstname.lastname@example.org, (55 11) 3195-5803
Brazil Steel Institute – Débora Oliveira, email@example.com, 55 (21) 3445-6327 | 6300
JISF – Shigeru Hagiuda, firstname.lastname@example.org, 81 3 3669 4835
Russian Steel – Maria Simonova, email@example.com, 79153226225
CFSBI – Mark Redding, firstname.lastname@example.org, 630.868.1234
Turkish Steel Producers Association – Veysel Yayan, email@example.com, 903124663734
ESTA – Dominique Richardot, firstname.lastname@example.org, 33 1 41 31 56 45
SAISI – Charles Dednam, email@example.com, 27 12 380 0900
KOSA – Min-Chul Lee, firstname.lastname@example.org, 82 02 559 3501
Ukrmetalurgprom (Ukraine) – Oleksandr Kalenkov, email@example.com,0442790525
SSINA – Larry Lasoff, LLasoff@kelleydrye.com, 202.342.8530
CPTI – Tamara Browne, firstname.lastname@example.org, 202.223.1700
Indian Steel Association – Arnab Kumar Hazra, email@example.com, 919958599032
A PDF of this Press Release is available: here