China raises steel export tariffs again in bid to boost carbon neutral goal
- Export tariffs for high-purity pig iron will be lifted to 20 per cent from 15 per cent, and tariffs for ferrochrome will be increased to 40 per cent from 20 per cent
- China will also cancel export tax rebates for 23 steel products, including some cold-rolled coils and silicon steel
China will raise export tariffs for pig iron and ferrochrome, and remove export tax rebates for 23 steel products from Sunday, the second adjustment in three months as it seeks to ensure domestic supply while controlling output to curb emissions.
The country will also cancel export tax rebates for 23 steel products, including some cold-rolled coils and silicon steel which have higher added-value compared with carbon steel.
“[The changes] aim to promote upgrade and high-quality development of the steel industry,” said the finance ministry.
China, the world’s top steel producer had already adjusted its tariffs on May 1, when it removed export tax rebates for 146 steel products, hiked pig iron and ferroalloys export tariffs and exempt some temporary import tariffs.
However, as steel demand and prices are still well supported by the global economic recovery, the country’s steel products exports picked up 23 per cent in June after a 34 per cent drop in May.
Meanwhile, steel output in the first half also jumped 11.8 per cent in China, making it harder to keep to the promise of no rise in annual crude steel production in 2021.
“The efforts to control exports are for more production curbs,” said Tang Chuanlin, analyst with Citic Securities.
Tang also noted that the steel supply crunch will remain in the second half of the year.
“Even though considering the backflow of exported products, the industry is still facing more than 5 per cent shortages,” he added.
Futures prices for the most-traded steel rebar and hot rolled coils on the Shanghai Futures Exchange had jumped 32 per cent and 37 per cent, respectively, so far this year.