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The price of major steel products in China rose 7.8 percent in May from the same period last year as demand and production costs both climbed, according to the country's top economic planning agency.

 

The steel price averaged 4,255 yuan (US$557) per ton at major markets in 30 provinces, municipalities, and autonomous regions, 3.34 percent up on April, said Wang Shuangzheng, an official at the Price Monitoring Center of the National Development and Reform Commission (NDRC).

 

Stainless steel recorded the biggest price jump, said Wang, outstripping low-end construction steel, pipe steel and plated steel. Stainless steel sheets were traded at 32,927 yuan (US$4,310) per ton on average, up 37.43 percent from last May.

 

Wang predicted the steel price will continue to rise in June as this is one of the peak seasons for construction and the prices of iron ore and coke are also climbing.

 

Despite the scrapping of export duties on some steel products, steel exports are booming with the international steel price higher than the price in China, Wang added.

 

China exported 21.3 million tons of steel products between January and April, more than double the 9.2 million tons in the same period last year, according to the General Administration of Customs.

 

The world's biggest producer and consumer of steel, China has introduced a series of measures to curb the growth in steel exports this year.

 

China imposed five to 10 percent export tariffs on more than 80 steel products including common carbon steel wire, sheets and plate on June 1.

 

The country also removed export tax rebates on 83 steel products and lowered the rate on 76 others to five percent as of April 15. A total of 83 steel products became subject to an export license management system on May 20.

 

"It may take a while before the measures take effect. Demand for steel remains high in the global market," said an NDRC report released last week.

 

(Xinhua News Agency June 7, 2007)