Steel ass'n: China cannot supply global steel industry

The removal of tax rebates on some steel products "reflects China's increasingly prudent attitude towards exports of resources including steel," said Shan Shanghua, secretary general of the China Iron and Steel Association (CISA), on June 29.

China does not have the abundant raw materials for steel production, and its iron ore import dependency has reached 70 percent. However, China remains a major exporter of steel products. The country's steel exports have increased 266 percent year on year to 4.9 million tons.

The contradiction between high iron ore imports and massive steel product exports reflects the dilemma of China's position in the steel industry.

"China shouldn't become the supply base for the world steel industry and will not release favorable policies for numerous exports of steel products," Shan said during an interview with China Central Television (CCTV).

The export of steel means the export of resources, raw materials, energy and means more pollution, Shan explained.

He admitted that the repeal of rebates will impact China's domestic steel products market in the short term.

"But the steel market won't witness a deep slump in the long run and the removal will help to boost the transformation of the development mode," he said.

By People's Daily Online