What are the similarities and differences in the export situation of steel between 2015 and 2025?

According to data from the General Administration of Customs on January 13, 2024, China exported a total of 1107.16 million tons of steel from January to December, a year-on-year increase of 22.7%. This data is also the highest level since 2015. What are the similarities and differences in the situation faced by steel foreign trade with the same industry downturn cycle and high export volume? Let'

According to data from the General Administration of Customs on January 13, 2024, China exported a total of 1107.16 million tons of steel from January to December, a year-on-year increase of 22.7%. This data is also the highest level since 2015. What are the similarities and differences in the situation faced by steel foreign trade with the same industry downturn cycle and high export volume? Let's briefly compare the various aspects before and after 2015 with the current situation.
In terms of export volume, in 2015, China exported 112.4 million tons of steel, a year-on-year increase of 19.9%, reaching a historic high. The export volume and growth rate are similar to the current trend, but the difference is that in the second two months of 2024, the industry generally has a clear prediction of Trump's tariffs and other policies after his election, which has stimulated the export volume to maintain a high level in the usual off-season, while there is no such clear phased situation in 2015. In terms of policies, in 2015, China's steel industry faced the problem of overcapacity, and the government introduced a series of policies to promote structural adjustment and transformation upgrading of the steel industry.

For example, the draft of the "Steel Industry Adjustment Policy" was released to guide the healthy development of the industry; The joint construction of the "the Belt and Road" initiative also promotes the export of steel products to countries along the line and expands the international market. Since 2023, the 'Work Plan for Stable Growth in the Steel Industry' has been released, emphasizing technological innovation and green development in the steel industry under the guidance of high-quality development requirements.

At the same time, the government encourages enterprises to optimize their export structure and increase product added value through policy guidance. For example, the export of high value-added products such as new energy vehicles has driven the indirect export of steel. In terms of fiscal and tax policies, China has cancelled the export tax rebate for boron containing steel since January 1, 2015, involving four types of steel products. In this cycle, in 2021, China cancelled the steel export tax rebate. Although the export quantity has significantly declined in the short term, after 2022, China's steel exports still show a strong recovery momentum, and its share of global exports has gradually increased. The export tax rebate rate is directly related to the profit level of enterprises. Cancelling or reducing export tax rebates will to some extent force enterprises with weak competitiveness and high dependence on export tax rebates to exit the market, promote industry concentration, and benefit enterprises with strong competitiveness and high efficiency. It is worth mentioning that in November 2024, export tax rebates for copper, aluminum and other commodities that are also raw materials were cancelled. In addition to export tax rebates, other types of subsidies from local governments are also being cleared and withdrawn. The previously announced "Regulations on Fair Competition Review" also explicitly prohibit relevant units from providing selective and differentiated financial rewards or subsidies to specific operators, with the core purpose of improving the marketization level of enterprise operations. Combined with the adjustment of export tax rebates, it will help promote the clearance of some outdated production capacity in the industry. In terms of external environment, with a large number of exports, there were as many as 37 anti-dumping and anti subsidy cases against China's steel products in 2015. In 2024, there has also been an increase in anti-dumping investigations targeting China's steel industry, with around 30 cases filed throughout the year.

The cases are spread across the globe, mainly in Vietnam, Brazil, the European Union, South Africa, and other regions, involving mostly sheet metal products. After newly elected US President Trump takes office, it is likely to impose a new round of tariffs on Chinese goods, affecting indirect steel exports and transit trade. Looking back at the export situation of steel in China over the years, there is a reverse relationship between export volume and price trend: during the period of steel price increase, export volume decreased (2016-2020); During the period of steel price decline, export volume increased (2012-2015, 2021-2024). The logic behind the inverse relationship between steel export volume and steel prices is that steel prices are priced more in line with domestic demand. As the world's largest producer of crude steel, China's export volume accounts for 5% to 10% of its production, which means that more than 90% of its production is consumed domestically. Therefore, steel prices are dominated by domestic demand. This also indirectly confirms the response of the spokesperson for the General Administration of Customs on January 13th: "China's steel industry continues to innovate and upgrade, mainly to meet domestic steel demand, while also providing innovative and high-quality products for many countries.

China's steel exports comply with market principles and World Trade Organization rules
Consider the past you shall know the future. The export trend of the previous cycle is worth referencing for the industry. At the same time, in this cycle, in addition to the increased risk of trade frictions, China's steel export trade also faces some new problems. Firstly, the price advantage has weakened. Although the export price of steel in China is relatively low, the decline in global inflation and the increase in steel supply from emerging steel producing areas such as Southeast Asia have weakened the price advantage of steel in China, and some overseas steel demand will be squeezed. The second is the slow recovery of the global manufacturing industry. In December 2024, the global manufacturing PMI was 49.5%, still fluctuating within a contraction range, and the recovery of external demand was relatively slow, which may have an impact on China's direct and indirect exports of steel. The third is the ongoing competition of "internal competition". At present, the trend of "increasing quantity and decreasing price" in steel exports is obvious, causing waste of production resources in steel mills and easily leading to raw material price premiums, causing both steel enterprises and export traders to fall into a thin profit trap of two-way squeezing. In response to the above issues, it is recommended that steel companies and traders continue to implement the export principle of "encouraging high-end, restricting low-end, and cracking down on illegal": firstly, to improve product quality and technological level.

Through technological innovation and process improvement, we aim to enhance the quality and added value of China's steel products, and strengthen their competitiveness in the international market. In the recently released 2024 performance forecast for listed companies, some steel companies that optimize their operations and product structure are demonstrating stronger competitiveness through industry-leading profit margins. The second is to diversify the layout of the international market. Actively exploring emerging markets, diversifying trade risks, and responding to the pressure of overseas supply growth. The third is to strengthen communication, exchange, and international cooperation. On the one hand, communication can to some extent resolve the vicious competition of "involution"; On the other hand, by participating in the formulation of international standards and rules, we can enhance the international discourse power of China's steel industry and reduce trade frictions. Looking ahead to the future, despite the pressure of trade frictions and the decline in international raw material prices, there is significant resistance to China's steel exports, and the cancellation of steel export tax rebates by the government will to some extent suppress the export of low value-added steel products. However, compared with other countries and regions, China's steel exports still have a cost advantage, and domestic enterprises will actively seek exports. It is expected that by 2025, with the joint efforts of steel enterprises and traders, the total export volume of steel in China will remain at a relatively high level.