Chinese Steel and U.S. Jobs

Substitute 'India and the UK' for 'China and US' and it's the same story.
We have steel mills being closed, sold off or mothballed, people unemployed, a government who cares more for the banks than the workers while they moan about lazy scroungers who won't work because they are a soft target.
We are importing steel.
We are becoming a nation of paper pushers and charity cases, successive governments have sold off our heavy industry down the river.
Meanwhile the energy sector which was sold off is profiteering now that Winter is on the way...pigs at the trough, yeah, whatever, who cares? Lets target the poor, sick and the students instead 'cos they can't afford fancy lawyers and lobyists to fight back.
Nick Clegg (substitute your politician of choice)? Would you buy a used car from him?

Don't blame China or India, blame your government and big business.
Del

<click, rant mode off>

There are a number of issues and assumptions here.

Really appropriate topic.{p] There is no doubt that China is the global powerhouse in steel. In 2009 it produced just under half of all steel (~47%) globally. With scale comes pricing power. Ask the Saudis.

What is not mentioned is the fact that steel is produced inefficiently in china when looking at energy required or Emissions per tonne.

The WTO fails and our governments fail to enforce an apples to apples production scheme, allowing the chinese to pollute like crazy, despite the fact that their pollutants are in fact detectable in the atmosphere here in the US.

But it is our government and the WTO, not the Chinese that are allowing this situation by their lack of action.

The economic issues are also pretty clear- there was a recession in 2009 thus steel production fell here in the US.

I am no enemy of foreign direct investment.

The Koreans have invested a couple of billion to build some damn nice autoplants here in Georgia and Alabama. They invested money, not sucked money out of the taxpayer coffers like the big two UAW Detroit bankrupt thinkers did.

BMW is the largest exporter of light vehicles from the US. Thank goodness for their Foreign Direct Investment.!

So if the chinese want to come here and build steel plants here, that they think will compete successfully against Gerdau, Nucor, and others, I say Bring it on!

We have allowed our dollar to fall and the Chinese to artificially manipulate their currency to build up a huge cash hoard. Why would we not expect them to try to spend some of that here in the us? On steelmaking capacity?

They have our money, now they want to spend it. Here.

The problem in my mind is not the Chinese. If I was playing their hand, I would likely have done sooner what they are finally getting around to. The problem is that the current and past US administrations have sat idly by, impotent, unable to get any substantial movement on currency revaluation.

So now the Chinese have a vast cash hoard in US dollars and are looking for something they understand to buy with it.

Wait till you see how much of GM they will own through SAIC, courtesy of the US bailout and Now IPO.

This "war" is being lost without a shot.

Now thats some CHANGE.

Milo

This just in from my favorite Steel analyst Michelle applebaum:

" Beijing Can't Tame the Beast. October Chinese average daily steel production increased from 1.60 mtpd to 1.62 mtpd, a nominal 1.5% uptick, but surprising given the reports coming from Beijing of extensive and meaningful production cuts during the month.

The surprising uptick in October steel production in China is reflective of the inability of Beijing – once again – to control its head-strong steelmakers. "

Milo