The "snatching effect" or short-term support for steel exports

In March 2025, China's monthly steel exports continued to show year-on-year growth. According to data from the General Administration of Customs, in terms of exports, in March, China exported 10.456 million tons of steel, a year-on-year increase of 5.7%; from January to March, China's cumulative steel exports totaled 27.429 million tons, a year-on-year increase of 6.3%. In terms of imports, in March, China imported 501,000 tons of steel, a year-on-year decrease of 18.8%; from January to March, China's cumulative steel imports totaled 1.55 million tons, a year-on-year decrease of 11.3%.

In March 2025, China's steel exports continued to show year-on-year growth, while steel imports remained at a low level. Therefore, China's steel foreign trade in March maintained a significant net export trend. Data calculated by Lange Steel Research Center shows that in March, China's net steel exports were 9.955 million tons, a year-on-year increase of 7.4%; from January to March, China's net steel exports were 25.879 million tons, a year-on-year increase of 7.6%.

Currently, China still has a Price advantage in steel exports; overseas steel supply continues to decline year-on-year; at the same time, the global manufacturing index has declined, and external demand remains weak. China's steel industry export order index is operating in the contraction range, and the intensifying trade conflicts faced by the steel industry will gradually become apparent. However, driven by the rush to export in April, steel exports are expected to remain relatively high, and with a decline in the year-on-year base (9.22 million tons), year-on-year growth is likely to be maintained. The relevant influencing factors are analyzed as follows:

1. China's steel export Price advantage still exists

With the adjustment of China's export quotations, China's steel export Price advantage still exists. Data monitored by Lange Steel Research Center shows that as of April 11, 2025, the FOB export quotations for hot-rolled coils in India, Turkey, and the CIS were US\$565/ton, US\$590/ton, and US\$485/ton respectively, while China's FOB export quotation for hot-rolled coils was US\$462/ton. Currently, China's hot-rolled coil export quotations are US\$103/ton, US\$128/ton, and US\$23/ton lower than those of India, Turkey, and the CIS respectively.

2. Overseas steel supply continues to decline year-on-year, releasing some space for China's steel exports

In February 2025, global crude steel production continued to decline year-on-year. In February 2025, the crude steel production of 69 countries included in the World Steel Association's statistics was 144.7 million tons, a year-on-year decrease of 3.4%. From the perspective of crude steel production outside China, the year-on-year decline continues. Data monitored by Lange Steel Research Center shows that in February, the global production outside China was 65.8 million tons, a year-on-year decrease of 2.7%, with the decrease widening by 0.7 percentage points compared to the previous month. The continued decline in overseas supply continues to release space for China's external steel demand.

3. Global manufacturing PMI declined, and external demand remains weak

In March 2025, the global manufacturing index showed a downward trend. According to the China Federation of Logistics and Purchasing, the global manufacturing PMI in March 2025 was 49.6%, down 0.4 percentage points from the previous month. JPMorgan's global manufacturing PMI in March showed a slight decline to 50.3% in the expansion range, down 0.3 percentage points from the previous month. The decline in the American manufacturing PMI to below 49%, down more than 1 percentage point from the previous month, was the main factor contributing to the decline in the global manufacturing PMI.

From the perspective of global economic evolution, the additional tariffs imposed by the United States have made trade friction inevitable, which has a negative impact on the United States and other countries around the world, resulting in a "lose-lose" situation in the short term, with increased global trade costs and disruptions to global supply chains. Data from the China Federation of Logistics and Purchasing and the Service Industry Survey Center of the National Bureau of Statistics shows that the China Manufacturing Purchasing Managers' Index in March was 49%, although up 0.4 percentage points from the previous month, it is still in the contraction range, reflecting that external demand remains weak.

4. China's steel industry export order index continues to operate in the contraction range

In terms of export orders, the export order index of Chinese steel companies continues to operate in the contraction range. The new export order index for steel companies surveyed by the China Federation of Logistics and Purchasing Steel Logistics Professional Committee in March 2025 was 41.1%, down 2.5 percentage points from the previous month; the new export order index for steel circulation companies surveyed by the China Securities Depository and Clearing Corporation Limited & Lange Steel Network was 49.3%, up 4.2 percentage points from the previous month. Both steel industry export order indices are operating in the contraction range, which will impose some constraints on China's steel exports in the future.

5. Trade protection continues to intensify, and China's steel exports will gradually come under pressure

In March, trade protectionism continued to intensify. On March 3, Mexico initiated an anti-dumping investigation into hot-rolled steel from China; on March 4, South Korea initiated an anti-dumping investigation into hot-rolled carbon steel and alloy steel from China; and on March 20, South Africa initiated an anti-dumping investigation into thin Specification corrosion-resistant steel coils from China. Simultaneously with the initiation of these investigations, the preliminary rulings, sunset reviews, and final rulings of some previous trade investigations, and the imposition of provisional anti-dumping duties, were also released. On March 4, South Korea made a positive preliminary ruling on anti-dumping against China's medium and thick plates, suggesting that the Ministry of Strategy and Finance impose provisional anti-dumping duties on the companies involved, with a rate of 27.91%-38.02%; South Korea imposed provisional anti-dumping duties on hot-rolled stainless steel sheets from China from March 25, at a rate of 21.62%.

Since April, the United States has gradually increased tariffs on China. On April 2, Trump issued an executive order imposing a 34% equivalent tariff on China, in addition to the previous 20% across-the-board tariff, totaling 54%; China retaliated with 34%; on April 8: Trump issued a revised executive order, increasing tariffs on China to 104%; China retaliated by increasing tariffs to 84%; on April 9: Trump issued a revised executive order, increasing tariffs on China to 125%; suspending equivalent tariffs on other countries for 90 days and only imposing a 10% \"base tariff\". On April 9, China retaliated with 125%. Given that at the current tariff level, American goods exported to China are no longer marketable, China will ignore any further tariffs imposed by the US on Chinese goods exported to the US.

The intensification of global trade protectionism, led by the United States, will significantly suppress China's steel exports in the future, and will also restrict the export of downstream steel products, thereby indirectly affecting exports.

6. Steel export buy-out will be terminated

On March 28, the State Taxation Administration, Ministry of Finance, Ministry of Commerce, General Administration of Customs, and State Administration for Market Regulation jointly issued the \"Announcement on Optimizing Services and Standardizing Management of Matters Relating to the Export of Goods Subject to Domestic Taxes\". Article 4 of the Announcement states: \"Before filing export declarations with the customs, taxpayers shall complete registration information Confirm through the electronic tax office or tax service hall. Those who have not completed registration information Confirm with the tax authorities, or who are in the situation of cancellation, abnormality, running away (loss of contact), etc., need to complete the relevant tax matters before handling customs procedures.\" Article 5: \"Taxpayers exporting goods subject to taxes shall apply for tax cancellation with the tax authorities before applying to the market supervision department for cancellation, and apply for cancellation registration with the market supervision department with a tax clearance certificate.\" The announcement further clarifies that export invoices are required (even for tax exemptions and refunds), increasing customs inspection procedures to prevent the \"separation of invoices from goods\". This is a strong blow to exporters and buy-out agents who want to continue to evade taxes and export at low Prices. Under the strengthened management of customs export declaration and other detailed inspections, the situation of steel export buy-out will be completely terminated.

In summary, while China currently maintains a price advantage in steel exports, the steel industry's export order index is operating within a contraction range. Intensifying trade protectionism and stricter domestic scrutiny of export orders will significantly suppress steel exports. However, given the increased external uncertainty, the rush to export may continue to support high steel export volumes in April. Based on the month-on-month decline in April 2024 steel exports (9.22 million tons), year-on-year growth in steel exports in April 2025 may still be maintained.
(Original article by Wang Guoqing, Lange Steel Research Center. Please indicate the source when reprinting.)