Global overcapacity has been hammering the steel-producing sector in many countries for years, but it’s a crisis without an easy solution that could remain for another decade, the chief executive of Germany’s second-largest steel maker Salzgitter told Handelsblatt.
That means import tariffs will remain in place and protectionism across the industry will grow even more common, Heinz Jörg Fuhrmann said in an interview at one of his factories in the northwestern industrial Ruhr region.
“The problem will not solve itself in a couple of years,” the 59-year old executive said. “We will need more time – I estimate between seven and ten years. In the European Union it also took years to address structural crises following a period of strong growth.”
Given the magnitude of the steel industry’s overproduction, change will not occur overnight, even with political backing. Mr. Fuhrmann said he expected trade tariffs to be a common feature of the steel market over the next decade as countries around the world ratchet up protectionist measures to shield their domestic industries against imbalances caused by overcapacity in China.