The Eurofer lobby said that European steel companies are at risk of destroying their own industry unless they close mills to cut overcapacity and halt falling prices.

Mr Wolfgang Eder CEO of Voestalpine AG said that “There is enormous danger for the whole industry. The plants need to be closed. The larger groups are destroying their businesses by keeping all the plants going.”

Mr Eder said that steel industry earnings have slumped as Europe’s economic crisis saps demand and slower Chinese growth weighs on prices. Steelmakers are grappling with spare capacity, while costs rise. Europe, with the capacity to make about 200 million metric tons of steel a year, needs to close plants capable of producing about 40 million to 50 million tons in the next 3 years.

European steel industry shares have tumbled 19% in 2013. ArcelorMittal, the biggest steel producer, said last month that European demand would drop to a low this year before rebounding.

He said that politicians and labor unions need to respect the decisions of company owners when it comes to closing plants. He added that “Interfering makes things worse.”

Meanwhile, ArcelorMittal faced political pressure and clashed with unions in France and Belgium following plans to shutter sites in Florange and Liege.