China enforces new tariffs on steel against the EU, Japan, South Korea, and Indonesia

July 23, 2019

Abstract : Beijing blames cheap productions as they may be damaging the local industry. The punitive tax rates, between 18.1% and 103.1%, will stay into force for five years. Italy should not be affected by the decision. Korean companies, with the exception of Posco, will be the most damaged.

MILAN, Jul 22 (Class Editori) – China will enforce new anti-dumping taxes on billets and hot-rolled, stainless steel plates coming from the EU, Japan, South Korea, and Indonesia.

The decision follows an investigation over some companies selling underpriced products, responsible for damaging the local industry, said the Chinese Ministry of Commerce. A preliminary decision had already been announced in March. The punitive tax rates, between 18.1% and 103.1%, will stay into force for five years.

The most affected country will be South Korea. Exception made for Posco, required to pay a 23.1% tax rate, the rest of Korean producers will be interested by the highest tariffs. As for the 28 EU countries, they will be suffering from a 43% rate. As reported by a logistic expert, Italy shouldn’t suffer too much from the decision, since its exports toward China are focused on the luxury segment.

Japan will be charged with 29% rates, with the exception of Nippon Yankin Kogyo’s products, benefitting from a 18.1%. Finally, regarding Indonesia, exporting the highest amount of products with applied tariffs in relation to market share, the aliquot is at 20.2%.

Stainless steel products are widely used, above all, in maritime transport, in the containers, and in the railways. According to the data collected by the Stainless Steel Council of China’s Special Steel Enterprises Association, during current year’s first quarter both imports and exports with China have been decreasing. The first is at 26.4%, while exports lost down 22.1%.

China is still the biggest producer and exporter of steel in the world. In 2018, abroad sales decreased down 9%, amounting to 66.9 million tons. The sector is also one of the most affected by the process of cutting China’s productivity excesses through the rationalization of the industry. The aim is to get rid of so-called zombie enterprises, unable to support production without public financial aid.

(Source:Class Editori)

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