Despite the fact that China slapped a ten-percent tariff on
steel billets in November 2006 to contain output, steel billet
exports have soared, jumping 54.4 percent the very month the tariff
came into force.
In November, China exported 1,480,000 tons of steel billets,
54.4 percent up over the previous month, according to customs
figures.
Billet exports for the January-November period reached 8,540,000
tons and were worth US$3,207.223 million, up 30.7 percent and 28.4
percent respectively year on year.
Exporters, expecting the government to raise the tariff by
another five percentage points, have lifted billet export prices by
five to US$10 per ton from Jan. 1, 2007.
The government's restrictive policy has proved no match for
robust international demand.
The production of steel billets, which consumes an enormous
amount of energy and resources and generates serious pollution, has
been discouraged by the government in recent years through a series
of policies.
Xu Xiangchun, a senior executive of the Beijing Lange Steel
Information Consultancy Co. Ltd., said the current tariff rate
should not be changed. He said billet exports will fall when
international demand shrinks.
Market forces are more efficient than administrative tools, some
analysts said.
If the government continues to raise export tariffs, overseas
billet manufacturers will corner the lucrative international
market, Xu said.
(Xinhua News Agency January 13, 2007)