Speaking at the 27th Brazilian Steel Conference held on June 9 in Brazil, Rafael Rubio, general director of Latin America’s steel association, Alacero, stated that China has not yet been able to make its transformation to a market economy and this situation explains, to a great extent, the development of the steel industry and the crisis on the global and regional steel market. According to Mr. Rubio, the problems of the Chinese industry are increasing, with overcapacity in the range of 400 million mt, growing losses, low prices, subsidies to be revised upwards, the imperative need to export and preserve employment, environmental restrictions, and the slow reform of its state-owned enterprises.
Mr. Rubio stated that, as long as China does not make progress in its economic transition, it becomes more difficult for its steel industry to make the desired structural changes to compete on equal terms with other private steelmaking companies. Accordingly, he continued, faced with this scenario, it is essential that governments adopt a proactive attitude to ensure that the competition conditions are equal before the Chinese steel industry which competes on the basis of supports and subsidies that give it artificial advantages.