China has announced a number of policy changes to redefine the current steel market landscape. In 2020, China’s share of global crude steel production increased to 56.5% from 53.3% in 2019. Despite the outbreak of the COVID-19 pandemic that caused the industry’s global growth outlook to collapse, China recorded an increase in crude steel production of up to 5.2%, touching 1.053 million tons. As a result, the national government has introduced new guidelines in a long-term effort since 2017 to reduce steel production and limit problems with production growth. Srivatsan Govindarajan, an analyst at Metals and Mining, said: “Although the uncertainty in demand and production levels due to COVID-19 has begun to subside in the second half of 2020, this crisis has forced Governments, especially China, must keep a close eye on the steel sector.” He added: “To mitigate any potential problems related to overcapacity and reduce steel production levels, the Chinese government has launched a number of initiatives in the form of import-export tax reform.” . One of the policy changes includes canceling the steel export discount rate from some steel products from May 1, 2021. Previously, this rate was 13%, affecting steel products with code 7205-7307, including stainless steel, coil steel, hot rolled and cold rolled steel plates.

Source: VITIC/Reuters

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