Chinese Steel Exports To The UK
Tata’s announcement of its intention to sell off its UK steel production facilities, ostensibly due to accusations of China dumping steel because of its excess production capacity, has made the headlines in the UK during the spring. MDS Transmodal has examined the evidence for Chinese ‘dumping’ of steel on the global and UK markets using its World Cargo Database, which allows it to monitor world trade by both volume and value and for detailed commodities.
China exported 106 million tonnes of steel in 2015, up from 39 million in 2010. However, most of these exports have been to the rest of the Far East, with China’s biggest customers being South Korea and Vietnam, south Asian countries as a whole imported 46 million tonnes (or 43% of total steel exports) from China in 2015.
The EU imported much lower volumes of around 8 million tonnes, of which some 0.8 million was into the UK. However, imports of steel from China to the UK have increased by about 160% since 2010, with a jump in imports seen in 2014.
Most of the imports into the UK by volume are steel bars and rods, rather than higher value products such as rolled steel, and represent about half of all UK imports from China.
The price of these Chinese imports of steel bars and rods as declared to customs has fallen from £379 per tonne in 2013 to £274 in 2015, a fall of 28% over two years, providing clear evidence of the impact of Chinese imports on the market price for ‘basic ‘ steel products in the UK. This will have benefited the businesses of processors of crude steel products and their customers in the UK, but will have damaged the market for UK-based steel manufacturers such as Tata at Port Talbot.