SteelOrbis Shanghai
On May 21, the Ministry of Finance of the People's Republic of China announced that in order to further curb exports of resource commodities of high energy consumption and high pollution, as well as to promote the trade balance, upon the approval of the State Council an export tariff rate adjustment will be effective on certain commodities as of June 1, 2007.
This latest measure will involve the imposition of export tariffs on 142 commodities. The tariffs of 83 varieties of steel products will be in the range of 5-10 percent. The steel products affected by this adjustment include common carbon wire rod, flats, profiles, and some other finished steel products. In addition, the tariff rates already effective on semis, ingots, pig iron and other primary products since last year will be raised from 10 percent to 15 percent. This latest move on the part of the Chinese government is a further macro-control measure targeting surplus capacity and excessive export growth, following the export tax rebate cancellation and the sharp reduction in the tax rebate which affected a total of around 80 different steel product varieties.
Furthermore, the export tariffs on some ferroalloys will be increased from the current 5-10 percent to 10-15 percent. Moreover, the export rebate rates for steel pipes and tubes are expected to be lowered down to 5 percent.
However, since there is at present no detailed list of the tariff adjustment, the details regarding the tariff rates for the various steel products are still being awaited. Those involved in the steel trade will have to wait and see what stance they should take with regard to the products retaining the tax rebate and also concerning the export rebate on steel pipes.