China is imposing anti-dumping duties for certain stainless steel products from Japan, Indonesia, the European Union (EU), and South Korea. They plan to apply tariffs between 18.1 and 103.1 percent to stainless steel hot-rolled plates and billets.
According to the Ministry of Commerce in China, this will go into effect on July 23, 2019.
Imports take over
This decision was the result of the anti-dumping investigation due to a complaint from Shanxi Taigang Stainless Steel last year. The investigation revealed dumping had occurred and damaged the stainless steel industry in China.
Stainless steel hot-rolled plates and billets are predominately used for containers, power generation equipment, petrochemicals, shipbuilding and rail equipment.
The largest producer of steel in the world is China. In 2018, they produced 26.71 tons of steel products. This was an increase of 2.4 percent from the previous year.
The Special Steel Enterprises Association showed exports and imports of stainless steel were down for 2019’s first quarter. China imported only 475,200 tons. This was a decrease of 26.38 percent from the previous year. Exports were at 797,300 tons, down 22.14 percent from the previous year.
The Belt and Road Initiative has provided Indonesia with the top benefits. When the price of an imported product is less than the normal price in the market, it is classified as dumping.
Impacts on foreign powers
The manufacturers in South Korea will take the biggest hit, with the exception of Posco. The duty increase for Posco is 103.1 percent. Meanwhile, the tariff for all 28 manufacturers in the European Union will be 43 percent.
For Japanese imports, it will be 29 percent with the exception of the 18.1 percent duty for Nippon Yankin Kogyo. Indonesian imports will be at 20.2 percent.
The majority of imports to China are coming from Indonesia. The move from China represents a double blow for the steel producers in the EU. Global overcapacity has already caused them to suffer. However, this is mainly due to the inability of Beijing to reduce production despite assurances.
As the biggest producer of steel in the world, they are responsible for in excess of fifty percent of the global output. According to a spokesman for the European Steel Association, the increased tariffs and duties might represent just one protective measure instigated.
EU struggles to find its footing
The stainless steel export market for the EU is at-risk. In the past, the EU has been a long-term and reliable supplier for the Chinese market. Similarly, there is a risk that stainless steel previously exported to China from the EU, Indonesia, South Korea and Japan may be deflected elsewhere.
All of these countries have been key steel exporters for China. The tariffs the United States placed on steel imports have already left the European steel producers reeling due to the steel diversion to the European Union. The Trump administration announced these tariffs last year.
China announced their anti-dumping duties one year after Shanxi Taigang Stainless Steel issued complaints that the local industry was being damaged by low-cost stainless steel imports.
The state owns Shanxi Taigang Stainless Steel. Several Chinese companies and eight foreign manufacturers were targeted by this complaint. One of the top producers in the world, Tsingshan Stainless Steel of Indonesia, was included in it as well.