(Yicai Global) July 6 -- China's government has been discouraging and taking action to curb steel exports amid lackluster global demand and rising trade frictions with the US, Europe and India over steel products.
China has imposed export tariffs and cut the export tax rebate on all steel products to less than 17 percent of the value-added tax rate, with some products now exempt, Mr. Shen Danyang, commerce ministry spokesman, said yesterday.
The country has been involved in more than 30 trade disputes over steel products so far this year as its steelmaking industry is faced with the problem of severe excess capacity. Rival producers accuse it of selling overseas at below cost after a slump in demand at home. Mr. Shen said steel products made in China are mainly for domestic consumption.
In its five-year plan to 2020, the government aims to trim steel production by 150 million tons, which represents an almost 19 percent drop from last year's total. China's steel production fell for the first time in over three decades last year, dropping 2.3 percent to 804 million tons, but still represented almost half of the world's total output of the alloy.
Steel exports rose 6.4 percent between January and May this year, compared with about 30 percent in the same period last year, according to customs administration figures.
Mr. Shen noted that the international steel trade is essentially a market based on diversity and complementarity among industries and it is led by demand from importing nations. China's steel products enjoy strong market competitiveness, and many steel products are highly complementary with local products.
Not only have they boosted the economic development of importing regions, Chinese steel has also brought substantial benefits to local downstream users and consumers, he said. Furthermore, while increasing its steel exports, China has also imported a great quantity of iron ore from other countries, with a year-on-year growth of 9.1 percent in the first five months this year.