The Global Threat to American Steel
Chronic global steel overcapacity has undermined the U.S. steel industry’s ability to support America’s national security needs for decades.
Governments around the world have used government subsidies and trade-distorting policies to prop up their domestic steel industries, resulting in massive overcapacity of steel in the global market. Global overcapacity and the surge of steel imports into the U.S. hurt domestic steelmakers and workers. Left unchecked, global steelmakers were able to flood the U.S. market with cheap, subsidized, and dirty (CO2- intensive) steel imports. This undercut our national security, prices, domestic production, employment and capital investments here in the U.S.
For example, China has used extensive government support to expand steel capacity for the past 20 years. As a result, China is now responsible for approximately 56.5% of global crude steel production, producing over one billion tons of steel in 2020. Other countries such as India, Brazil, Korea, Turkey, and European Union nations have all used unfair trade practices to boost their own domestic steel industries, resulting in global excess capacity.
This global overcapacity problem persists today. The Organization for Economic Co-operation and Development (OECD) has found that global excess capacity is 5.8 times the productive capacity of the entire U.S. steel industry. Source: EPI study
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