The advantage of export quotation for China’s steel products still exists, the tax rebate adjustment may cause orders to shrink

Since March, steel market prices at home and abroad have generally risen, and the export quotations of steel products in various countries have also increased significantly, China’s steel export quotations still have advantages. According to the monitoring data of the Lange Steel Cloud Business Platform, on April 12, 2021, China’s hot-rolled coil export offer (FOB) was US$831/ton, which was 14% lower than that of India, CIS, and Turkey, compared with other countries. US$94 and US$44/ton.

Overseas steel demand is recovering, but in order to cope with the risk of export tax rebate reduction or cancellation, Chinese steel companies temporarily postpone the export quotation of hot-rolled products, or stipulate in the export contract that once the export tax rebate policy is officially introduced in the future, the relevant risks will be borne by Buyer & Seller equally, which led to the weakening of the competitiveness of steel exports and the shrinking of export orders. According to data from the Iron and Steel Logistics Professional Committee of the China Internet of Things, the new export order index of the steel industry in March this year was 43.7%, a sharp drop of 17.7 percentage points from February and the lowest since the fourth quarter of last year.