China’s finished steel exports have surged to a new record high of 9.72 million tonnes in November, up 13.7% from October and almost double the 5mt exported in November 2013, preliminary Customs figures show. The surge puts China well on its way to exporting more than 90mt of finished steel this year, Kallanish notes.

Over January-November 2014, China exported 83.61mt of finished steel - up 46.79% from 56.96mt over the same period in 2013. China’s exports have surged as pressure has mounted for local mills to export material to compensate for weak domestic demand.

Export volumes over November and December are expected to be high, in part because of the slowdown in the domestic economy and construction activity, and in part because of uncertainty over China’s export tax regime next year. A change in China’s VAT rebate for alloy steels has been discussed at ministerial level, prompting rumours that the rebate could be removed. Many buyers brought forward their orders to November and December to ensure they had sufficient material before taxes changed on 1 January.

In fact, no tax change has yet been announced and views are increasingly mixed. While there is said to be some support for an adjustment to the rebates, sources are now suggesting any change may be delayed. This may be due to the unexpectedly fragile state of the economy, they suggest.

China also imported 1.13mt of finished steel, bringing the year’s total to 13.22mt, up 2.7% y-on-y.