China has pushed back after the U.S. boosted anti-dumping and anti-subsidy duties on some of its steel products, saying mills in the world’s biggest economy lack competitiveness because they are over-protected. Protectionism in the U.S. steel sector is deeply worrying as these measures will only exacerbate friction without helping to solve the problem of shrinking global demand, the commerce ministry said in a statement on Thursday. “China believes that the lack of competitiveness in the U.S. steel industry is the result of over-protection,” it said. The world is awash with steel as demand drops in China, which accounts for about half of global production. To offset declining consumption, overcapacity and weakening prices at home, Chinese mills have boosted exports to record levels. That’s raised trade tensions worldwide, spurring a fightback from rival producers and forcing policy makers to try to address the problem, including at May’s Group-of-Seven meeting in Japan. “China urges the U.S. to abide by the World Trade Organization’s rules and to use trade remedy measures judiciously,” the commerce ministry said after the U.S. ruling from the International Trade Commission, a federal body. ‘Materially Injured’ The U.S. has been “materially injured” by imports of the cold-rolled steel flat products from China, as well as Japan, which have been determined to be sold at less than fair value and subsidized, the ITC said in a statement on Wednesday. All six of the ITC’s commissioners backed the move, it said. A revival in steel prices in China earlier this year spurred mills to fire up capacity, prompting Axiom Capital Management Inc. to predict that the country’s exports will probably stay elevated. Exports of steel from China will remain at high levels as local demand shrinks, the country’s Metallurgical Planning Institute said in April. To tackle the problem in China, the government has announced plans to cut as much as 150 million tons of excess steel-making capacity over five years. Shinzo Abe, Japan’s prime minister who hosted G-7 leaders in May, said then China isn’t doing enough to tackle oversupply in the industry.