News Archives

NAFTA Steel Industry Urges OECD Steel Committee to Support Development of International Database for GHG Emissions

May 21, 2007 ( Ottawa, ON )

The North American steel industry has recommended that the Steel Committee of the Organization for Economic Cooperation and Development (OECD) support international efforts to develop a comprehensive, accurate database for the global steel industry of greenhouse gas (GHG) and other emissions. The industry voiced its concerns about the negative environmental consequences of uneven regulatory and compliance efforts by nations around the world as well as their anti-competitive impact.

The recommendation was made in a paper submitted by the American Iron and Steel Institute (AISI), the Steel Manufacturers Association (SMA), the Specialty Steel Industry of North America (SSINA), the Canadian Steel Producers Association (CSPA) and La Camara Nacional de la Industria del Hierro y del Acero (CANACERO).

In its paper, the NAFTA steel industry strongly urged the OECD Steel Committee to support current efforts by the International Iron and Steel Institute (IISI) to develop a common database on GHG emissions. The paper suggests that GHG regulation may already be having a significant impact on the global steel industry, investment and trade flows, and that the OECD Steel Committee, national governments and the global steel industry need accurate data in a standardized form.

The paper points out that worldwide production of steel has substantially increased over the last decade, by about 470 million tons, with most of the expansion occurring in countries, especially China, that in general have greater amounts of inefficient steel production and weaker environmental regulation or enforcement. Likewise, the more developed countries, including most if not all OECD countries, have strict emission and operating limits that are actively monitored and enforced, while the developing countries’ enforcement is typically less stringent and more random. Shifts in steel production from NAFTA to those countries will result in a higher level of global emissions and thus global environmental consequences far into the future.

A major concern of NAFTA steel producers, identified in the paper, is that if measures to control greenhouse gas concentrations do not take international trade, and especially the environmental consequence, into account, then GHG emissions will actually increase globally, as production increases in regions subject to lower environmental compliance standards and, therefore, costs.

Obviously, any efforts to limit GHG emissions from steel production that did not include all major steel producing regions could at best be only partially successful, the paper notes. Adoption of effective emissions control schemes that do not distort competitiveness requires, as a starting point, a common and consistent database and assurances that data are accurate, the paper states.

The paper notes that in the NAFTA region through voluntary efforts driven by market forces, the steel industry includes many of the cleanest steel producers in the world in terms of GHG emissions and energy efficiency. In the United States, iron and steel production accounts for about one percent of total US GHG emissions. In Mexico, steel industry GHG emissions represent approximately 2.5 percent of total emissions, and direct process-related emissions by the iron and steel industry in Canada in 2004, accounted for only 1.9 percent of total Canadian emissions. Between 1990 and 2004, the U.S. and Canadian steel industries reduced their direct process-related GHG emissions per ton of steel produced by nearly 47 % and more than 26 percent, respectively—while, in Mexico, steel industry direct process-related GHG emissions per ton declined by as much as 50 percent between 1990 and 2004.

Contact Information:
Nancy Gravatt, AISI (202/452-7115)
Tom Danjczek, SMA (202/296-1515)
Meg Mullery, SSINA (202/342-8439)
Ron Watkins, CSPA (613/238-6049)
Octavio Rangel, CANACERO, (52-55) 5448-8160