Subsidies granted to Chinese steel manufacturers deemed 'disruptive' to fair market competition by OECD
Global Steel Market: OECD Warns about Distorted Competition due to Chinese Subsidies
Per a report from the Organisation for Economic Co-operation and Development (OECD), the substantial subsidies that Chinese steel manufacturers receive from the government are significantly distorting competition in the global market. On average, companies in China secure five times more state support as a percentage of their revenues than businesses in other nations, according to the OECD.
As a result, the global steel market is faced with distortions due to non-market forces, making it challenging for manufacturers without subsidies to compete on equal grounds. China, the world's largest steel producer, has witnessed a decline in domestic demand, particularly in its real estate sector, prompting companies to seek overseas markets aggressively.
Since 2020, Chinese steel exports have surged, reaching an unprecedented 118 million tons in 2024, while imports have dropped by nearly 80% to 8.7 million tons. This trend poses a substantial challenge for other countries, as their own exports decrease while imports increase, according to the OECD's 2025 Steel Outlook. In the European Union and North America, steel imports have risen by almost 13% and 40%, respectively.
This situation has led to increased trade restrictions, with 19 governments initiating 81 "anti-dumping investigations" into steel products in 2024, five times more than in 2023. Over one-third of these cases involve China. In March 2024, US President Donald Trump imposed tariffs of 25% on steel and aluminum imports into the US.
To restore sustainably healthy profitability for steel producers, the OECD emphasized the need to address global overcapacities effectively. Achieving fair competition conditions in the global steel market would require global cooperation, the OECD added.
References:1. ntv.de, AFP2. OECD Report on Chinese Steel Subsidies3. OECD 2025 Steel Outlook4. China Steel Industry Report5. OECD steel market monitoring
The Community policy and employment policy of various countries should address the issue of distorted competition in the global steel market, considering the substantial subsidies Chinese steel manufacturers receive from their government. To maintain fair competition and sustainably healthy profitability for steel producers, there is a need for cooperation among industries, finance sectors, and governments in enforcing global market regulations and employment policies.
