Posted on 12 Mar 2026
Zhao Minge, Chairperson of China’s major steel producer Shougang Group and a delegate to the National People’s Congress (NPC), has re-emphasized the capacity control as the top priority in tackling excessive competition -- or “involution” -- in the steel industry, while recommending the restoration of export tax rebates for premium steel products. He made the proposal during the ongoing “Two Sessions” political meetings in Beijing.
The NPC delegate believes that tackling steel industry "involution" starts with capacity control. "I hope it can help close the door to new capacity additions and facilitate the exit of inefficient capacity so that the steel industry can truly regain vitality," Zhao said in an interview with China Metallurgical News, a media outlet supervised by China Iron and Steel Association (CISA).
Zhao mentioned that during China's 14th Five-Year Plan, domestic apparent crude steel consumption fell by nearly 200 million tonnes -- a challenge "extremely severe for any country."
Against this backdrop, he noted that the steel sector's "involution" is both a reactive response to external pressures such as declining domestic demand and a proactive behavior by some steel firms blindly expanding output and undercutting prices.
"The urgent priority is to improve the steel industrial environment," Zhao said, citing content in the 2026 government work report and principles proposed by CISA as similar efforts in this regard.
In response to industry calls for restoring export tax rebates for high-end steel products, Zhao recommended reinstating a 13% rebate on products such as electrical steel, automotive sheet, tin-plated steel, and seamless pipes, covering 18 tariff codes, with annual exports of around 8 million tonnes worth roughly $10 billion.
"Stable exports of these premium products are crucial for maintaining China's share in global automotive, new energy, power, oil and gas, and can-making supply chains," he said. "They also provide a significant pillar in the high-quality development of the Chinese steel industry."
Speaking about China's reintroduction of the steel export licensing system, which took effect this January and covers 300 steel products under Chinese HS codes, Zhao described the policy as vital for regulating steel exports and promoting high-quality development, though its full impact is yet to be seen.
Amid China's declining steel export prices and frequent trade disputes, Zhao stressed the strategy of "promoting high-end, stabilizing neighboring markets, and strengthening supervision."
China's exports of high-end steel products are key to global market positioning, while stable neighboring markets safeguard overall export performance. Stricter export oversight, including persistent crackdowns on tax evasion, protects revenue and China's international reputation, he said.
In addition, Zhao highlighted the significance of connecting the steel industry with emerging sectors such as robotics.
"We need to pay attention to non-traditional areas that historically used little steel but are now experiencing rapid growth in steel consumption," he said, while emphasizing the role of new productive forces in transforming traditional industries such as the steel sector.
"I have always believed that the reason our country remains so competitive, even in a challenging international trade environment, is largely due to traditional industries. They remain the foundation of our country's overall competitiveness and will not be absent in developing new productive forces. In fact, their development and advancement are often more urgent than emerging or future industries," Zhao said.
Source:Mysteel Global
