On three occasions this month I have spent time in the BBC Radio 5 Live studios answering questions on the ailing British steel industry. My on-air ‘appearances’ were the result of SSI UK and Tata Steel closing plants and slashing jobs in Redcar and Scunthorpe in the United Kingdom – and it’s all China’s fault.
The Chinese economy is slowing but China is producing more steel than it needs. Result? It ‘dumps’ excess metal on foreign markets, the global steel price dips and steel producers struggle to survive. It’s happening all over the world, but unlike in North America – where anti-dumping and countervailing duties are imposed on ‘rogue nations’ like the Chinese – Europe’s lumbering bureaucratic machinery is slow, and some would say unwilling, to react.
Something must be done, but I doubt if David Cameron, the British Prime Minister, will jeopardise his rather dangerous nuclear power deal with the Chinese by berating Xi Jingping for dumping cheap steel on the UK market.
The Chinese problem is one that requires a multi-lateral approach. Xi Jingping needs to be told – in no uncertain terms – that China can’t expect to be granted ‘market economy status’ (which it craves) if it doesn’t behave like one. Make no mistake: Chinese steel producers, unlike those in the west, don’t have to generate a return on capital. We’re back to what western steel producers crave most: a level playing field. But will they ever get one and does anybody really care? Not the UK government, it seems.
The proverbial ‘man on the Clapham omnibus’ must be wondering whether the British Government is serious about the survival of its homegrown heavy industry and, indeed, the much talked about ‘northern powerhouse’ it promised to create if a high speed rail link is established between London and ‘the north’. It’s all beginning to sound like empty rhetoric.
How is it that we find ourselves in a position where, through countless European directives and punitive green taxes, we have regulated our foundation industries into virtual oblivion? Why have we given steel producers in other regions of the globe an unfair advantage when it comes to competing on the world stage?
Applauding ‘globalisation’ is fine, but why should western steel producers play with both hands tied behind their backs?
This issue of Steel Times International discusses many different subjects. On the technical front we have three interesting articles on ironmaking and then, in keeping with our aim to keep readers abreast of the latest steel industry conferences, a report from the editor of the magazine on the 49th World Steel Association Conference, which this year was held in the Windy City, Chicago, USA.
Myra Pinkham discusses the US Oil Country Tubular Goods market and, in Perspectives, we hear from Thermo Fisher Scientific's Kevin Quinn who argues that overcapacity creates opportunities.
Regular features, such as industry news, country updates and, of course, the History page make up this month's issue and we still have one more issue to go before the year-end.