China imported 4.91 million tons of steel in the first quarter of this year, a rise of 17.5 percent over the same period of last year, sources revealed from the State Economic and Trade Commission.
Particularly 2.12 million tons of steel was imported in March, hitting a new high over the last two months. This indicates the imported steel starts to challenge the domestic market and the large import volume will go on for a period of time to come.
Three reasons result in the growth of imports according to analysis.
First, China has cut the tariff and cancelled the restriction on import volume after its entry into the WTO. The tariff of steel is expected to drop from 8.11 percent to 5.14 on average, a decrease of 36.62 percent, but the actual cut is more than that.
Secondly, the world surplus steel with lower price shows a tendency to challenge China's domestic market when China cancelled the restriction on import volume.
Thirdly, the devaluation of the currencies in Japan and Argentina has relatively increased the competitiveness of their exported steel.
Meanwhile, owing to the increasing disputes in world steel trade plus the lower price in the world steel market, China has experienced a dramatic drop in exporting steel in the first quarter. It saw an exportation of 990,000 tons of steel, a decrease of 12.3 percent and of 200,000 tons of steel billet, a drop of 70.4 percent.
(People's Daily April 19, 2002)
