FOCUS: What China's possible new steel export taxes mean for global ferrous industry

Market chatter about China possibly imposing new export taxes for steel as part of commodity price cooling measures has been rampant in the past week, causing traders and market participants to re-think their trading strategies, and overseas buyers to consider a potential supply shortfall.

The taxes are supposed to take place from June 1, but there has been no official statement by China's Ministry of Finance so far and market participants are in disagreement about whether these taxes will come into force. Yet some sources say the rumors are growing stronger, which they take to be a sign the policies will be enacted.
Alongside the possible steel export taxes are more cancellations in export rebates for other flat steel products such as cold-rolled coil and hot-dipped galvanized coil.
The global ferrous industry typically looks to China for price guidance, including billet sellers in Turkey and the Middle East, as well as iron ore producers in Europe and Brazil.
Flat steel in focus
Market sources in China said the main target of the export taxes is hot-rolled coil, which has been a red-hot commodity in recent months.

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