FOCUS: Looming China tax change freezes flat steel export trades

A looming potential steel export tax, and more changes in value-added tax rebates for steel exports, are keeping export trades very thin, sources told Fastmarkets.

There has been increasing market chatter in recent weeks about more changes in steel tax rates which could be announced on August 1, causing hesitation and confusion in export trading.

Market sources said the VAT tax rebate on cold-rolled coil and galvanized coil could be reduced, or removed, while there could also be export taxes imposed on steel to control export volumes.

"Many Chinese steel mills are not giving offers, or are just listing high offers with no real intention of selling, because of this," a key Vietnamese buyer of hot-rolled coil told Fastmarkets in the week to July 27.

Traders handling hot-rolled coil are reporting thin demand from buyers and limited supplies with which to enter negotiations. 

Many major steel mills are listing HRC offers up to $1,000-1,030 per tonne fob China, although there were also offers heard at $940-960 per tonne fob China by...


Paul Lim

Zihuan Pan

July 27, 2021

12:15 GMT

Singapore, Shanghai