World’s largest steel manufacturer, China’s, steel exports rose once again by 3.7%, M-o-M basis in May’16 and is recorded at 9.42 MnT in May’16 against 9.07 MnT in Apr’16.
This has raised a serious concern regarding country’s efforts to cut its excess steel production capacity which was promised by the country’s government in the start of year 2016.
In first five months of the year 2016 (Jan-May), country exported 46.28 MnT of steel, up by 6.4% against corresponding period of previous year.
With the seasonal pick-up in demand from construction sector post Chinese Lunar New Year Holidays in Feb’16, country’s both domestic and export steel prices surged by USD 100-120/MT in time span of just two months, thus, boosting the production appetite of country’s steel manufacturing firms.
However, as the demand slowed down in domestic market, Chinese steel makers opted for offshore markets in order to dump their excessive production resulting in increased steel exports in May’16.
Many countries including US and European Union has imposed many trade barriers in the form of anti-dumping duty and countervailing duty against Chinese imports.
Nevertheless, as per customs data, South Korea is the top market for Chinese steel with total shipments reaching to 36.90 MnT in first five months of 2016 as compared to 3.77 MnT to US during the same period. The exports to Korea are high due to the bilateral trade agreement signed between the two countries.
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