China policy on steel industry affect international market
International steel price is much higher than domestic market,strong power for China export
The price for international market is much higher than domestic market.As the internet shows that the FOB price for Hot rolled coil is USD921/Ton on the date of 29th April,2021 inside China.The price is USD29,USD99,USD69 lower than price from India,CIS and Turkey.And steel price in Europe and America is much higher.The price for hot rolled coil is USD1160 at Europe on the later April.USD1500 at America.It is almost triple times than average price of 20 years.The steel price for buildings in Europe and USA and Japan are higher than domestic market.
The price gap between domestic and international market stimulates export greatly.China export 2.5 million tons of steel during January to April that is 24.5% year-on-year growth.In April this year, the steel industry's new export order index was 51.7%, a sharp increase of 8.0 percentage points from March, again entering the expansion range.
The fast growth of steel export volume make tension in domestic steel market.This is key factor for steel price going up quickly.So,China authority increase the duty for export.some policy are formulated,like canceling the tax rebate with export for hot rolled coil etc 146 kinds of steels.Add 0 duty for primary steel products.It will be helpful for domestic steel demand and supply.
Adjustment of import and export tariffs can affect international market
China measures can greatly affect international market on two aspects.
Firstly,it reduces the steel supply of international market.Since the 4th quarter of last year,the global economy is starting to resume itself,the global manufacturing industry recoveries.and Biden government promises to expand in infrastructure.These factors push the demand for steels.on the other hand,COVID-19 virus makes the production stop.And the Trade protectionism rises and some government increase tariffs on steel products.China takes big steel markets in the world,it reduce the export and it will affect the international market.
Secondly,it will push international price go up.The price fluctuation in the international market is due to the overall unbalance of supply and demand.The shortage of supply push the america steel price.China measures for limit the export will push the international price go up again.
So,we can conclude that the trend of international steel price will go up in future.
