Chinese steel exports waiting for new policy

SteelOrbis hears rumors regarding tax rebate slash and export duty implementation gaining strength in the last few days, in China. It has been a while since market has got into expectancy that the Chinese authorities will slash tax rebate for finished steel products from 11 percent to 5-6 percent. Furthermore, a 5 percent export duty may be levied on the semi-finished products, although it is relatively less likely. In such an environment where almost everyone is expecting such changes in the regulations to take place, the business activity for products involved inevitably gets affected. Currently, Chinese mills are spending extra efforts to complete productions and shipments for previous orders before the announcement of new policies. Meanwhile, offers and new transactions almost halt, with concerns of mills and buyers to prefer to wait for a clarified medium. In a strong international market, chances are high that such additional costs put on the Chinese exports might be compensated, however in case of softening market conditions Chinese exporters may lose from their competition power, as a result of such implementations.