Stella Yifan Xie and Tom Fairless of The Wall Street Journal report that China is flooding international markets with unfairly low prices as they are facing an economic slowdown at home. They write:
Some Chinese factories, saddled with overcapacity in a struggling economy, are trying to export their way out of trouble and stoking new trade tensions in the process.
Makers of electric vehicles, solar panels and other products are cutting prices and trying harder to muscle into overseas markets as they face weakened demand at home, upsetting competitors who see threats to their bottom lines.
The tensions are most acute in Europe, where European Union regulators in September unveiled an antisubsidy probe, reflecting concern that China is flooding the region with low-cost electric vehicles. […]
Another industry economists are watching closely is steel.
China, the world’s biggest producer, is likely to see demand fall 1.1% this year from a year earlier, in part because of sluggish housing construction, according to forecasts by the China Iron and Steel Association in July. Production continues to rise, it said.
China’s steel export prices have plunged about 60% from a year earlier, while its steel exports volume went up 53% in October compared with 2022, according to Frederic Neumann, chief Asia economist at HSBC.
In response to a petition from the U.S. steel industry, Washington in August announced a levy of around 123% on imported can-making metal from China, along with levies of under 10% on German and Canadian companies that produce the material.
Overcapacity in China, combined with too much production elsewhere, “can trigger deep crises in the steel industry in the future,” said Ulf Zumkley, chair of the steel committee of the Organization for Economic Cooperation and Development, a forum for governments of mostly rich countries, in a September statement.
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