German steel orders and output are rising again but Hans Jürgen Kerkhoff, president of the German Steel Federation, is in no mood to celebrate. On the contrary. “There is no reason to sound the all-clear regarding the continuing threat to the German steel industry,” he told the 21st Handelsblatt Steel Conference in Düsseldorf.
The survival of the German steel industry remains at risk from massive excess capacity among Chinese steel producers, Mr. Kerkhoff said. And now there’s a further danger. “Unfortunately, we are seeing increasingly protectionist tendencies around the world,” said Germany’s top steel lobbyist.
Frank Schulz, the head of German operations for Arcelor-Mittal, the world’s largest steel company, even believes a trade war is possible, given the growing tendencies toward isolation. “It cannot be ruled out,” he said.
Protectionism is rampant everywhere, with government subsidies, import tariffs and restrictive certification rules. U.S. President Donald Trump declared “America first” to be his supreme motto. With the withdrawal of England, Scotland and Wales from the European Single Market, isolationism also threatens to make a comeback in Great Britain. The European steel industry is likely to suffer as a result.