Chinese language - Steel exports soar 43.56% in June

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BIZCHINA / Impacts

Steel exports soar 43.56% in June

By Shangguan Zhoudong (chinadaily.com.cn)
Updated: 2007-07-12 11:49

China exported 6.36 million tons of steel products in June this year, up
43.56 percent year on year and 3.08 percent from May this year, according
to statistics from China Customs released July 10.

The June steel export is higher than the 6.17 million tons in May but
lower than 7.16 million tons in April this year, a record month in the
nation's steel sales abroad.

Steel exports are supposed to decline in response to China's newly
enforced tariff rebate adjustments, and insiders said the surge was a
result of enterprises rushing to export as much as they could ahead of
the July 1 implementation of new policies.

To help reduce the trade surplus, the government said it would lower the
rebate on the value added tax of about 37 percent of its export
categories beginning July 1.

Export tax rebates for 553 "high energy-consuming and resource-intensive"
products, such as cement, fertilizer and non-ferrous metals, will be
eliminated.

Rebates for another 2,268 products, described as "likely to trigger trade
frictions", will be slashed from 8-17 percent to 5-11 percent. They
include garments, toys, steel products and motorcycles.

The government reduced tax rebates on exports of 76 steel products such
as stainless plate and cold-rolled steel sheet to five percent and
eliminated the tax rebate on 83 particular steel products including
hot-rolled steel sheet and section steel from April 15. It also applied
export license management to those same 83 steel products as of May 20.

Earlier, on June 1, the government levied five to ten percent export
tariffs on those categories of steel products and upped duties on
overseas shipment of another 19 categories to 15 percent from 10 percent.

As of July 1, export tax rebates will be reduced from a current 13
percent to 5 percent for seamless steel pipe, stainless steel pipe, steel
rail, welded steel angle and steel section.

Zhou Tao, a researcher with Guojin Securities Co Ltd, said that the
policies were effective.

He predicted net export of steel and steel billets in June would be 4.95
million tons and 730,000 tons respectively.

He also expected net export of raw steel to be 5.94 million tons, around
40,000 tons less than May.

Zhang Shibao, a researcher with China Merchants Securities, said that
these policies' influence would fade in two to three months, and the
total export of steel products for this year is estimated to account for
10 to 11 percent of China's total production.

In the first half of this year, China exported 33.79 million tons of
steel products, up 97.7 percent year on year while the nation imported
8.69 million tons of steel, down 7.6 percent year on year.

From January to June this year, a total of 4.37 million tons of steel
billet was exported, up 40.9 percent year on year while only 140,000 tons
of it was imported, down 34 percent year on year.

(For more biz stories, please visit Industry Updates)

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