China plans to lower export rebate on some steel products

China plans to lower export rebate on some steel products

In a move to reinforce Beijing’s strategic target of having the iron and steel industry serve the domestic market and bring balance to the country’s imports and exports, the State Reform and Development Committee reportedly worked out a draft on reducing the export rebate rate on some steel products. Pending final approval, the State Reform and Development Committee plans to reduce the export rebate rate on rebar and strip steel products by 3 percentage points, effective January 1, 2006. Such a reduction would lower the export rebate to 8 percent. The export rebate on these products had been lowered by 2 percentage points, to 11 percent, this past May. The reduction in the export rebate rate will impose pressures on prices of rebar and strip steel products in domestic market, squeezing profit margins. The China Iron and Steel Association had mixed reactions to this future policy.