Steel mills may find permits waived

By Helen Yuan  |   2008-12-18  |     NEWSPAPER EDITION

CHINA, the world's largest steel-making nation, may allow mills to export without needing permits in a bid to support an industry struggling with falling demand and prices.

The elimination of permits would simplify export procedures and save time, said Li Longgang, manager of international trade department IV at Sinosteel Corp, one of the nation's two largest steel traders.

China introduced export permits on steel products last year as part of a set of wider measures, including taxation, to reduce overseas shipments but Chinese steel makers have been badly affected by the global economic slowdown, and the government is planning to buy stockpiles and give higher export rebates.

Exporters currently need to pay a small fee to obtain an export permit for each type of steel product, a process that is time-consuming, Li said.

Wang Sujuan, an analyst at Mysteel Research Institute, said: "Removal of the license would only be a minor step."

The removal of licenses won't necessarily boost exports since the government didn't seek to restrict shipments with permits previously, said Wang Hong, a sales manager with Shougang Corp, the only Beijing-based steel maker.

China's steel-product exports fell 36 percent in November from a month ago as the global economic slowdown curbed demand.

China exported 2.95 million metric tons of steel products last month, 28 percent lower than a year ago, date compiled by Bloomberg News showed.