Major steel-producing countries failed to agree measures to tackle a global steel crisis as the sides argued over the causes of overcapacity, prompting US criticism of Beijing's approach and an angry response from Chinese officials.
A meeting of ministers and trade officials from over 30 countries, hosted by Belgium and the OECD on Monday, sought to tackle excess capacity, but concluded only that it had to be dealt with in a swift and structural way, Reuters reported.
Washington pointed the finger at China over the failure of the talks, saying Beijing needed to act on overcapacity or face possible trade action from other countries.
"Unless China starts to take timely and concrete actions to reduce its excess production and capacity in industries including steel ... the fundamental structural problems in the industry will remain and affected governments—including the United States—will have no alternatives other than trade action to avoid harm to their domestic industries and workers," US Secretary of Commerce Penny Pritzker and US Trade Representative Michael Froman said in a statement.
Li Xinchuang, the vice secretary of general of the China Iron and Steel Association, rejected the US criticisms.
Asked what steps the Chinese government would take following the unsuccessful talks, China Commerce Ministry spokesman Shen Danyang told reporters on Tuesday: "China has already done more than enough. What more do you want us to do?"
The OECD said global steelmaking capacity was 2.37 billion tons in 2015, but declining production meant that only 67.5% of that was being used, down from 70.9% in 2014.
Britain in particular has felt the squeeze as its largest producer Tata Steel has announced plans to pull out of the country, threatening 15,000 jobs. Last week, more than 40,000 German steel workers took to the streets to protest against dumping from China.
China, the world's top steel producer, has been ramping up exports of steel in recent years, as it battles to steer its economy into services-led growth and away from traditional manufacturing, while keeping employment levels high.
China's steel exports jumped 30% from a year ago to 9.98 million tons in March despite a slew of anti-dumping measures globally.
But blaming China for woes in the global steel industry is simply a lazy excuse for protectionism, and such finger-pointing will be counter-productive, China's official Xinhua news agency said in a commentary on Monday.
Deep Divisions
At a news conference following Monday's meeting, deep divisions between China and other producers were clear.
Cecelia Malmstrom, the EU's trade commissioner, insisted governments should not grant subsidies that keep unviable plants running and should subject state-controlled firms to the same rules as the private sector.
China's assistant commerce minister, Zhang Ji, said China had cut 90 million tons of capacity and had plans to reduce it by a further 100-150 million tons.
"That is only 10 million tons less than the capacity in Europe," he said, although critics say it would still have a capacity of around one billion tons, far in excess of its needs.
China's main iron and steel body has previously acknowledged that the flood of Chinese steel product exports is damaging to the country's efforts to gain market economy status from the European Union—an important goal for Beijing as the domestic economy slows.
Tensions have erupted between other producers, with Japan leading criticism of Indian minimum prices for imported steel at a recent World Trade Organization meeting and Japan and South Korea coming under fire for exporting steel products cheaper than they sell them at home.
