China’s planned export-license requirement would not be effective in curbing steel export volumes or support a recovery in prices, Japan Iron and Steel Federation chairman Tadashi Imai said yesterday.
China, the world’s largest steel producer, on Dec. 12 announced plans to roll out a license system from next year to regulate exports of the metal, as robust shipments have fueled a growing protectionist backlash worldwide.
The Chinese Ministry of Commerce on Thursday last week said the proposed export license requirement for 300 steel products would allow closer monitoring of steel exports.
Photo: Reuters
“Our understanding is that this measure is intended to curb exports of substandard steel products, and we don’t believe it will be an effective countermeasure for current issues such as suppressing export volumes or influencing market prices,” Imai told a news conference in Tokyo, adding that the permits were aimed at controlling product quality.
China’s steel exports have ballooned since 2023, following the recovery from the impact of the COVID-19 pandemic, despite trade barriers being enforced by a growing number of countries on the grounds that the cheap products damage domestic manufacturers.
In the first 11 months of this year, China’s outbound steel shipments jumped by 6.7 percent year-on-year to a record high for the period at 107.72 million tonnes, while the corresponding US dollar value fell by 2.1 percent, Chinese customs data showed.
Ballooning exports by Chinese steelmakers have become an international concern, with Japan among countries criticizing Chinese firms for receiving government subsidies that encourage overproduction and low-priced exports, worsening global market conditions.
The federation forecast Japan’s domestic steel demand from the construction and manufacturing sectors would remain flat in the fiscal year starting in April, with crude steel output expected to be unchanged from the current year.
The Japanese Ministry of Economy, Trade and Industry this week predicted that Japan’s crude steel output for the current year would fall 3.2 percent to 80.33 million tonnes, the lowest since fiscal 1968.
Asked about the impact from US tariffs, including a 50 percent levy on steel and a 15 percent tariff on Japanese goods, Imai, who is also president of Nippon Steel Corp, said the tariffs would cut about ￥20 billion (US$128.2 million) from his company’s profit this fiscal year, with exports to the US halving from a year earlier.
“But the overall impact, including indirect effects from the 15 percent tariff on automobiles, was smaller than we had anticipated,” he said.
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