Excess Capacity
On September 30, 2026, members of the Global Forum on Steel Excess Capacity (GFSEC) adopted a Comprehensive Framework for Joint Action (the Framework) to address persistent global steel excess capacity. Representing market-based steel producing economies that account for nearly 56 percent of global steel imports, GFSEC members committed to a coordinated set of actions aimed at restoring a level playing field and protecting the long-term viability of the international steel industry.
GFSEC members include Argentina, Australia, Austria, Belgium, Brazil, Canada, the European Union, Finland, France, Germany, Greece, Hungary, Italy, Japan, the Republic of Korea, Luxembourg, Mexico, the Netherlands, Norway, Poland, the Slovak Republic, South Africa, Spain, Sweden, Switzerland, Türkiye, the United Kingdom, and the United States.
Background
The global steel market continues to face growing excess capacity challenges, with worldwide surplus steelmaking capacity projected to exceed 745 million metric tons by 2028. According to the GFSEC, this overcapacity is driven largely by non-market policies and government interventions that shield unprofitable steel producers from market forces, allowing excess production to persist.
Comprehensive Framework for Joint Action
The Framework outlines a series of concrete actions GFSEC members intend to take through their respective national legal frameworks in a coordinated effort to address both the symptoms and root causes of persistent excess capacity. The ultimate objective is to restore market conditions where steel producers can compete fairly, while facilitating market driven adjustments and the exit of uneconomic capacity. Below is a summary of actions GFSEC members intend to undertake:
- Eliminate Market Distorting Subsidies: Reduce market-distorting subsidies and government support measures that contribute to excess steelmaking capacity, while permitting limited restructuring assistance that supports market-driven adjustment and long-term viability.
- Enhance Supply Chain Transparency: Further transparency by collecting and sharing steel trade data, including “country of melt and pour” information, to improve monitoring of steel imports, identify suspicious trade patterns, and address potential circumvention of trade measures.
- Enforce Evidence Based Trade Remedies: Utilize antidumping, countervailing duty, safeguard, and other trade measures, while enhancing coordination to detect and address circumvention, monitor trade diversion, and promote transparency.
- Evaluate Steelmaking Raw Material Export Restrictions: Assess how non-GFSEC members are imposing export restrictions on steelmaking raw materials and evaluate appropriate responses to address the impact on global excess capacity.
- Evaluate Regulatory and Enforcement Gaps: Assess whether weak regulatory frameworks or inadequate enforcement practices unfairly reduce production costs and contribute to global excess capacity.
For additional details regarding the commitments undertaken by GFSEC members, please review the Framework.
The Husch Blackwell International Trade and Supply Chain team will continue to monitor developments related to the Framework and provide updates as additional information becomes available. If you have any specific questions, please contact your Husch Blackwell attorney.