In fact, the world’s most populous nation now produces more steel than the next four largest producers combined: Japan, the United States, Russia and South Korea.

Chinese mills make 31 percent of the world’s steel. Between 2000 and 2005, Chinese steel production grew by 170 percent, from 126 million metric tons to 349 million metric tons.

China’s steel exports quadrupled between 1998 and 2005. Steel imports flooding into the United States doubled between 2000 and 2005.

The growing economic impact of Chinese steel is analyzed in a new report published by the American Iron & Steel Institute called “The China Syndrome: How Subsidies and Government Intervention Created the World’s Largest Steel Industry.”

“This explosive growth in both production and exports would not have been possible without the support of the Chinese government,” the report states.

Government support takes many forms: cash grants, tax refunds, discounted government land sales, forgiving company debts and loans, granting other loans at a fraction of normal interest rates and reducing prices of imported raw materials.

Rep. Alan B. Mollohan, D-W.Va., has long been an advocate of measures to protect jobs at steel mills located in his district, including Wheeling-Pittsburgh Steel and Weirton Steel, now part of Mittal USA.

“Fair trade cannot happen unless all countries follow the rules. This report provides fresh evidence that China doesn’t. There is no excuse for us to continue letting it happen,” he said.

“It’s well past time for the United States to stand up for our companies and our workers. Instead of turning a blind eye to China’s actions, we need to shine a spotlight on them and demand that they be halted now.”

The new report found the Chinese steel industry “benefited from massive direct and indirect subsidies, many of which violate the [World Trade Organization] Subsidies Agreement, China’s obligations under its WTO accession agreement or both.”

The rapid expansion of Chinese steel production, the report adds, has led to the “displacement of production in dozens of steel consuming industries from the United States to China, at the cost of hundreds of thousands, if not millions, of American jobs.”

For several years, Mollohan has backed attempts to curb China’s anti-competitive trade practices, working with his colleagues in the Congressional Steel Caucus and members of the Stand Up for Steel Coalition.

Mollohan has co-sponsored federal legislation to revoke China’s Permanent Normal Trade Relations status and repeatedly urged the Bush administration to set quotas on government-subsidized steel pipe imports.

But free-trade advocates in Congress and the White House have repeatedly blocked all those initiatives.

In addition to cash grants, low-interest loans and cheap raw materials, China helps its steel mills by making little effort to provide steelworkers with decent wages, while workplace health and safety conditions are often disastrous, according to the report.

“Workers throughout China are regularly denied basic labor rights,” the study notes. “China’s labor law prohibits workers from organizing independent unions and does not provide for the right to strike.”

The only trade union in China is the All China Federation of Trade Unions, which is basically an extension of the ruling Communist Party.

Workers who protest working conditions and wages are routinely given layoffs, prison time for “subversion of state power” and police beatings, which are sometimes fatal.

In 2005, the U.S. State Department released a study that found China has no policies to prevent child labor, no national minimum-wage laws, no guaranteed overtime pay and “poor enforcement of occupational health and safety laws.”

Chinese coal miners probably face even worse conditions.

Official government statistics revealed 5,986 coal miners were killed last year. But far more fatalities may go unreported.

According to a February 2006 story released by France’s main news service, Agence France-Presse, independent estimates set the number of annual mining deaths at up to 20,000 in 2005.

China changed dramatically from a net importer of steel in 1990 to a net exporter today.

China’s membership in the WTO, strongly backed by the Bush administration, requires it to eliminate government subsidies and to provide other WTO member nations with detailed information about its subsidies.

China does neither.

China did not become a major steel producer until the 1980s. Its steel industry had been decimated by 15 years of war when the Chinese Communist Party came to power in 1949.

After Mao Zedong took over, he began using massive government resources to expand heavy industry. In 1958, Mao launched the “Great Leap Forward” to force massive industrialization. It also led to millions of deaths, especially of peasants moved off their land.

Mao’s project also “led to the widespread establishment of small steel mills — the so-called ‘backyard blast furnaces’ — in towns and villages throughout China.” It was “an economic, technological and environmental disaster,” the report states.

The explosive development of Chinese steel production began in 1990. But today, the industry is still fragmented.

In 2000, 1,045 different steel companies operated in China. But only 34 produced more than 1 million tons of steel a year.

Today, there are about 800 steel companies. Only 16 produce more than 5 million tons a year.

In 2004, the report states, just one Chinese steel company, Shanghai Baosteel, ranked among the world’s 10 largest producers. Only two companies, Shanghai Baosteel and Anben, produced more than 10 million tons of steel a year.

The Chinese government is planning to consolidate mills and reduce total steel-making capacity from 414 million tons last year to 400 million tons in 2010.

The development of China’s steel industry will continue to be dominated by government planning and subsidized by billions in government funds.

Without government aid, “the Chinese steel industry would probably be a fraction of its current size,” the report notes.

Steel subsidies are only part of a pattern. China also provides grants and tax subsidies to a variety of other businesses operating at a loss.

In recent reports to the WTO, the Chinese government revealed it continues providing massive subsidies to ferrous-metal, textile, machinery, coal, oil, chemical and tobacco companies.

The report concludes: “The economic stability and security of the United States, and the health of the global environment, demand that the Chinese government end its policy of subsidization” of the steel industry.

Other groups sponsoring the study were the Steel Manufacturers Association, the Specialty Steel Industry of North America, and the Committee on Pipe and Tube Imports.

The American Iron & Steel Institute report, “The China Syndrome,” is available online at www.steel.org.

To contact staff writer Paul J. Nyden, use e-mail or call 348-5164.

‘The pollution is staggering’

Among the ways China has fostered its steelmakers’ growth is to ignore environmental dangers, according to the American Iron & Steel Institute’s new report “The China Syndrome.”

On paper, the country’s environmental laws appear strict. But local governments responsible for enforcement do little or nothing, the report says.

“The scale of pollution is staggering,” it states. The Shougang mills in Beijing discharge about 18,000 tons of particulates annually, it also says.

On a 2005 visit to China, U.S. steel representatives toured mills of all sizes that “lacked any standard pollution control devices.”

Environmental analyses reveal the “concentration of pollution in China closely tracks the location of the steel industry” near the Pacific Ocean.

Steel-generated pollutants include nitrogen dioxide, sulfur dioxide and solid particulates. Some studies estimate China generates 25 percent of all particulates emitted worldwide.