China plans to keep its steel exports at high levels

 
Jessica Morris
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China cannot further bolster exports to solve overcapacity (Source: Getty)

China indicated it will keep pumping out high levels of steel in the future, as the world's second largest economy is coming under fire for its part in the UK steel crisis.

Luo Tiejun, the vice head of the raw materials department at the Ministry of Industry and Information Technology (MIIT), said today that if its exports remained at 100m tonnes, production levels would stay at around 800m tonnes.

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Tata's recent decision to sell-off its loss making British business has ramped up pressure on the government to take action against cheap steel flooding the market from China and Russia.

China has come under fire into the UK for dumping steel onto its markets, particularly in light of Tata Steel's recent decision to sell-off its British arm.

Think tank IPPR has warned Tata's decision could lead to 15,000 job losses directly, while a further 25,000 jobs in the company's supply chain are also at risk.

Tata plans to kick off the formal sales process of the its UK business on Monday.

China also admitted it's steel exports are hurting a bid for market economy status from the European Union.

Read more: Is the writing on the wall for the British steel industry?

The country's iron and steel association secretary general, Liu Zhenjiang, said the recovery in prices in 2016 had created a "vicious circle," increasing raw material costs and also production.

"Cutting steel capacity is important but controlling steel output is more important," he said.

The EU must decide by December whether to grant China market economy status, a move which would limit its power to impose duties on cheap Chinese imports.

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