In a major policy shift, China has withdrawn export rebates on major finished steel products and cut import duty on various semi-finished, crude, and scrap steel.
As per the latest announcement, China has removed VAT rebates on exports of 146 steel products from May 2021. It includes key export products like hot-rolled coils (HRC), wire rods, and rebar. China has also cut import duty on pig iron, crude steel, and steel scrap. Further, it has raised export duty by 5% on high silicon steel, ferrochrome, and foundry pig iron.
Decoding the Move
This latest policy shift indicates that China’s government is attempting to curb steel exports while concentrating on resolving the domestic shortage. China has been developing this strategy for some time, and this latest step is in line with it. The Chinese government had earlier put restrictions in Tangshan, China’s largest steelmaking city, to keep domestic steel production down in 2021.
Source link