The European Union has launched new probes into imports of Chinese steel, warning that it wouldn’t allow ‘unfair competition’ to threaten Europe’s industry already crumbling under a flood of cheap imports. CCTV’s reporter has talked to government officials and industry experts in Beijing on the issue.

The iron and steel industry has become the main area where China-Europe trade friction occurs.

China’s Ministry of Commerce says Chinese steel makers are not engaged in any form of dumping of surplus goods into the European Union.

“Low preliminary tariffs are not evidence of dumping by China. Overcapacity is a worldwide industry problem,”

“The Chinese government and enterprises made efforts to restructure the steel industry and reduce excess capacity and these made headway,” said Shen Danyang, spokesman Ministry of Commerce.

The EU market accounts for less than eight percent of China’s iron and steel export market. Experts say China hopes to deal with the overcapacity together with the EU, and protectionism will only exacerbate the situation.”

For Xu Xiangchun who’s worked for the China Iron and Steel Association for over ten years, blaming China for the slumping iron and steel market in Europe is unfair.

Xu now works for one of China’s biggest steel e-Commerce sector companies… and as one of his tasks is to deal with up-to-date steel prices everyday, he thinks the EU is not a main market of China’s iron and steel export industry.

According to the Association, Asia accounts for over 70 percent of China’s main export market in this industry while the EU is less than eight percent.

“The selling prices of China’s steel products in the EU market is about twenty percent higher than China’s domestic prices. So it’s unfair to say that China’s is selling below the cost of production,” said Xu Xiangchun, Chief Analyst of Mysteel.com.

In recent years, the EU has frequently imposed anti-dumping and anti-subsidy measures against iron and steel imports from China and other exporters.

Chinese steel exports have been the subject of 37 investigations worldwide in 2015, and that equalled the probes over the previous two years.

“These anti-dumping investigation measures have produced few results in bringing down the import volume. This has shown the problem lies not in imports but in the iron and steel industry in Europe itself,” said Xu.

China has seen a wave of shut downs last year in small- and medium-sized iron and steel smelters. However, State-owned enterprises really have the say in the total output.

The central government has called on them to replace outdated capacity with advanced technologies. But it will take time for these measures to have an impact.