Product Dumping Worries Arab Steelmakers

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Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--The global steel market is being hit by uncertainty, leading to pricing pressures and squeezed margins. Although the slow recovery of economic fundamentals appears to be trundling along, world steel markets can expect a bumpy ride for some time to come.

This has been evident in the past few days because of the 2014 Arab Steel Summit in Dubai, where participants are calling for serious steps to counter the danger posed to Arab steel project investments by the reported dumping of Chinese, Turkish and Ukrainian steel products.

"Dumping practices by Chinese imports had had direct impacts on their sales and revenues of Arab producers and their competitiveness," said Khaled Al Qadiry, head of the Arab Iron and Steel Union.

Not pulling his punches, he added, "China had begun to invade Arab markets with products of very low quality," according to a report by the Egyptian Independent.

Frank Beckers, senior advisor for global management consulting firm McKinsey & Company Incorporated (New York, New York), said that he had a 30-page research paper, which mainly blamed Chinese dumping for serious losses to industrial sectors in several developing countries, especially those with growing demand for iron and steel products. Worldwide, 25 steel producers, mainly from Asia, represent 55% of world production, meaning that production capacities will ensure extra growth for Asia.

Edwin Basson, chairman of the World Steel Association (Brussels, Belgium), predicted that Chinese dumping will cause a slowdown in Middle East factories.

Turkish, Ukrainian and Chinese imports influence a large section of the Egyptian market, and factories are sustaining heavy losses due to declining production, said Ayman al Ashry, a board member at the Egyptian Chamber of Metallurgical Industries, at the Federation of Egyptian Industries.

For related information, see October 30, 2014, article - Mining Companies Lose Power Over Steel-Making Material Prices.

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