Posted on 05 Aug 2026
The American Iron and Steel Institute (AISI) has criticised a position paper by the Chinese Ministry of Commerce which denies the existence of excess steel production capacity. This is stated in a press release issued by the organisation.
As Kevin Dempsey, President and Chief Executive of AISI, noted, global overcapacity is not a figment of the imagination, as the Chinese ministry’s report claims.
“Excess capacity in the global steel industry has been widely documented by the Organisation for Economic Co-operation and Development (OECD) and remains a serious threat to the US steel industry,” he emphasised.
Dempsey pointed out that, according to the latest OECD analysis, global excess steel production capacity is forecast to rise to 745 million tonnes by 2028, compared with 640 million tonnes in 2025. China is one of the leading sources of this excess capacity, although other countries also pose a threat.
“In fact, China’s steel production capacity in 2025 accounted for almost half of total global production and was more than double the combined steel production capacity of Brazil, Canada, the EU, Mexico, Japan and the US. In 2025, given the long-standing decline in domestic demand for steel in China, the country’s steel exports rose to 131 million tonnes, equivalent to the total steel consumption of North America as a whole,” explained Dempsey.
The AISI also cited OECD data showing that in 2024, Chinese steel mills received 15 times more subsidies relative to the size of their assets than steel companies in the rest of the world. They noted that significant government intervention in the Chinese steel industry is the main problem, leading to subsidies and other non-market policies and practices.
The American Iron and Steel Institute has reaffirmed its support for the continued application of US trade measures, including Section 232 steel tariffs and potential further action under Section 301 of the Trade Act of 1974.
It should be noted that the Ministry of Commerce of the People’s Republic of China states in a relevant report that, as concerns about their industrial competitiveness and market positions have grown, some countries and economies have politicised economic and trade issues. As the ministry pointed out, by highlighting China’s so-called excess capacity, other parties accuse the country of flooding the global market and use this as a pretext to tighten restrictions on the country, ‘fuelling protectionism’.
It should be recalled that, as stated in the OECD’s June report, excess steel production capacity continues to put pressure on global markets.
Source:GMK Center
