The Organisation for Economic Cooperation and Development said the global steel market was “distorted by non-market forces, where producers which do not benefit from the subsidies cannot compete on an equal footing”.
“China’s steel subsidisation rate (as a percentage of firm revenues) is five times higher than the average for other partner economies,” it added, pointing out that Chinese steel exports have more than doubled since 2020.China’s exports reached a record level of 118 million tonnes in 2024, while imports plummeted by nearly 80 percent to 8.7 million tonnes, according to the OECD.
Those changes for the world’s leading steel producer pose a “significant challenge” to other countries as their own exports fall and imports soar, said the “OECD Steel Outlook 2025” report.
Since 2020, steel imports have increased by nearly 13 per cent in the European Union and Britain, 18 per cent in Japan and South Korea, 40 per cent in North America, 52 per cent in Turkey, 60 per cent in South America and 77 per cent in Oceania.
Chinese exports to third markets are also surging, it added.
Some of those markets “are also grappling with growing excess capacity, such as Northern Africa, the Middle East and Southeast Asia, which in turn increase their exports, particularly to OECD countries, because their domestic markets are saturated with excess steel”, the report stated.
The situation is leading to a proliferation of “trade remedies”. In 2024, 19 governments initiated 81 “antidumping investigations involving steel products” – a five-fold increase on the previous year.
“Almost 80 per cent of the cases were initiated against Asian producers, with China alone accounting for more than one-third of the total,” the report said.
US President Donald Trump this year imposed 25 per cent tariffs on all imported steel as part of his trade revolution.
The British government passed emergency legislation in April to take over the country’s last steelmaking blast furnaces after the Chinese owners of British Steel had threatened to close the plant. Jingye steel said that the British operation was no longer viable.
The abundance of cheap steel is sharply affecting decarbonisation investment efforts in the industry, with steel production itself responsible for eight per cent of global CO2 emissions.
“Steelmakers cannot return to sustained healthy levels of profitability until global excess capacity and its consequences are meaningfully addressed,” the OECD said.
“Global co-operation is needed for a level playing field in the global steel market,” it added.
