China 2007 steel products exports seen up 20 pct after H2 slowdown

China's steel product exports are expected to reach 51.6 mln tons this year, up around 20 pct from the 2006 level, the China Iron and Steel Association (CISA) said, indicating a slowdown in the second half of the year after nearly 100 pct growth in the six months to June.

"China's steel product exports in the second half will 'evidently' decrease compared to the first as government's measure to curb exports will show results," said Luo Bingsheng, vice chairman of the association.

The government announced twice, in April and June, that it was cutting export rebates on steel products -- except for those on pipes for oilfield use which will be maintained at 13 pct -- to 5 pct from 13 pct, while removing tax rebates on another steel products.

China exported 33.79 mln tons of steel products in the first half of the year, up 97.7 pct from a year earlier.

Last year the country exported 43.0 mln tons of steel products, up 109.6 pct year-on-year.

Luo added that the industry association is considering implementing a licensing management system for exporters in order to further cool exports growth.

China has been trying to discourage exports of some products in a bid to avoid friction with its major trading partners.

Luo noted that steel producers face cost pressure from rising raw materials costs and fuel expenses.

China imported 187.91 mln tons of iron ore in the first half of the year, with average CIF (cost, insurance and freight) price at 74.64 usd per ton, up 13.23 usd per ton from a year ago, Luo said.

Luo told reporters that China's steel firms will hold iron ore price negotiations with Brazil's Companhia Vale do Rio Doce (CVRD) and Anglo-Australian miners BHP Billiton and Rio Tinto. He declined to give a forecast for import prices.

He expects Chinese supply and demand for iron ore from international markets to be basically balanced.

China's output of crude steel is expected to rise 14 pct year-on-year to 480 mln tons in 2007, while consumption is seen at 446 mln tons, up 12 pct, the CISA said.

The association added that demand for crude steel is expected to rise to 476-536 mln tons in 2010.