Posted on 26 Aug 2021
Chinese steel exports have been very quiet recently, both because steel mills have little inclination to sell abroad and because overseas buyers are also holding back, concerned about new export taxes, market sources said.
The central government’s removal of export duties of 13% on 23 additional steel products only took effect on August 1, a Beijing-based steel trader observed. “Buyers need some time to accept such a jump in prices (and) there is also talk that new export taxes may be imposed soon,” he said to explain the quiet export market recently.
On the sellers’ side, Chinese steel mills are also less willing to book new export orders, in consideration of many factors including limited supply, uncertainties over shipment and the risks of new taxes, according to him.
A Shanghai-based industry source also noted there are fewer offers from steel mills nowadays “and very limited resources available for export.”
Steel producers across the country have been scaling down production one after another since July, in response to Beijing’s call for lower crude steel output this year as part of emission reduction measures, Mysteel Global notes.
“With output being reduced, steel producers will first guarantee supplies to their long-term (domestic) clients,” the Beijing trader said, adding that mills would prefer not to provide offers or accept small export orders.
Last Thursday, China Iron & Steel Association advised its member steel mills to avoid exporting common grade steel products or, if they must, to export as little as possible, as Mysteel Global reported. Some major players have been heeding CISA’s call, market sources noted.
With the absence of China-origin steel products in international markets, other countries have raised their proportion for exports, a second Beijing-based market watcher noted.
“Since the beginning of August, Indian steel mills have exported large quantities of hot-rolled coils to North Africa, Middle East and Central and South America,” he claimed, saying that the export price for India-origin SAE1006 HRC was at $955/t CFR to Turkey.
Last week, China’s export price of SS400 4.75mm HRC reversed down $8/tonne on week to $926/t FOB from North China’s Tianjin port, according to Mysteel’s assessment. The price of China-origin SPCC 1.0mm cold rolled coil also reversed down $5/t on week $1,014/t FOB from Tianjin port.
Source:Mysteel Global
