CHINA will cut export taxes on steel billet and pig iron from the start of 2016, the finance ministry said yesterday, the latest move by the world’s top steel producer to erode a domestic glut and offer a lifeline to the stricken industry.

    As part of a raft of measures aimed at boosting economic growth in the world’s second-largest economy, the ministry said it will cut the 25 percent export tariff on billet and pig iron to 20 percent and 10 percent respectively from Jan. 1.

    The move underscores the deepening crisis in the world’s biggest steel industry as the country’s economic growth slows, leaving stricken mills to struggle with plunging prices, waning demand from real estate to shipbuilding, and tight credit. Many have gone bankrupt or cut output.

    Chinese steel mills have cut shipments of both products since 2008 when duties were raised to current levels. In January-October, China exported 141,659 tons of pig iron and 5,367 tons of steel billet, said Kevin Bai, analyst at CRU in Beijing.

    Preliminary customs data Tuesday showed China’s shipments of steel products topped 100 million tons for the first time in the first 11 months of the year.

    Two exporters in China said the tariff cut was too small to help boost exports, but it will likely escalate trade tensions with Europe and the United States, which have accused the country’s mills of deliberately dumping surplus production.

    As part of yesterday’s statement, the government said it would also eliminate export tariffs on phosphoric acid and ammonia and cut taxes on some energy raw materials, but it did not identify which materials would be subject to the cut.

    It kept tariffs on naphtha, jet kerosene, diesel, fuel oil, ethylene/propylene, propane and benzene unchanged. It also kept base metals and nickel pig iron tariffs unchanged.(SD-Agencies)