The World Organization for Economic Cooperation (OECD) warns of global overcapacity
The Steel Committee of the Organization for Economic Cooperation and Development (OECD) warned at a meeting on February 23 local time that as COVID-19 suppresses demand, global industry will face greater risks from overcapacity.
The committee concluded its annual meeting on Tuesday. In memory, the committee stated that the gap between production capacity and output increased to 625.4 million tons in 2020, with more projects receiving government support and based on future demand growth. Several of these investments are cross-border.
The committee stated that there is a huge risk of exacerbating overcapacity and increasing the possibility of supply further exceeding the actual market demand The committee stated that at the same time, steel manufacturers continue to feel the impact of this epidemic on the economy. The committee stated that it is expected that global steel demand will only partially recover in the short term, and the demand for finished steel is expected to remain below Covid-19 levels by 2021.
