Rising Steel Imports Challenge China's Steel-makers

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Last updated at: (Beijing Time) Friday, April 19, 2002

Rising Steel Imports Challenge China's Steel-makers

China imported 4.91 million tons of steel in the first quarter of this year, a rise of 17.5 percent over the same period of last year. Particularly 2.12 million tons of steel was imported in March, hitting a new high over the last two months. This indicates the imported steel starts to challenge the domestic market and the large import volume will go on for a period of time to come.

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China imported 4.91 million tons of steel in the first quarter of this year, a rise of 17.5 percent over the same period of last year, sources revealed by the State Economic and Trade Commission (SETC).

Particularly 2.12 million tons of steel was imported in March, hitting a new high over the last two months.

This indicates the imported steel starts to challenge the domestic market and the large import volume will continue in the foreseeable future.

Three reasons resulting in growth of imports

Three reasons result in the growth of imports, according to the SETC.

First, China has cut the tariff and cancelled the restriction on import volume after its entry into the WTO. The tariff of steel is expected to drop from 8.11 percent to 5.14 on average, a decrease of 36.62 percent. Experts believe, however, the actual cut is even more.

Secondly, the oversupply of steel in the world market shows a tendency to challenge China's domestic market when China cancelled the restriction on import volume.

Thirdly, the devaluation of the currencies in Japan and Argentina has relatively increased the competitiveness of their steel.

Meanwhile, owing to the increasing disputes in world steel trade plus the lower price in the world steel market, China has experienced a dramatic drop in exporting steel in the first quarter.

It saw an exportation of 990,000 tons of steel and 200,000 tons of steel billet, down respectively by 12.3 percent and down by 70.4 percent during the first three months this year.

By PD Online Staff Yang Ruoqian

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