2015, the Chinese economy is in the process of deleveraging, downstream steel industry in general downturn in exports to ease domestic steel supply and demand has become an important channel. From January to November 2015, total exports of all kinds of domestic steel 101.75 million tons, representing an increase of 19.91 million tons, the cumulative increase of 24%. Meanwhile, foreign steel exports to China, "double reverse" more cases, some countries also raise protective tariffs against Chinese steel. This led the market for Chinese steel exports to doubt the sustainability of high growth. In this paper, a detailed comparison of the competitiveness of China's steel exports and the major countries, try to analyze this hot issue, and put forward policy recommendations on this basis.

First, China's steel exports Overview

2009 export volume has continued to grow, the annual compound growth rate of 29.2%. January to November 2015, total exports of domestic steel products 101.75 million tons, an increase of 24% in 2015 annual export 114.1 million tons of steel. Since 2009, the annual compound growth rate of 29.2%.

2011 exports continued to decline in the average price, since the cumulative decline of 45%. Since 2011, the annual average price of domestic steel exports continued downward. 2015 1 ~ 11 months, average export price of $ 573 / ton, compared with the 2011 average export price fell $ 1,048 / ton $ 475 / ton, a decline of 45%.

Wire rod exports accounted for a significant rise, lumber exports accounted declined. Domestic exports of steel to the plate and wire rod based. January-October 2015, exports accounted for 44% of the plate, down 14 percentage points lower than the highest proportion of 58% in 2010; bar and wire rod exports accounted for 38 percent, up 28 percentage points compared to 2009, accounting for 10%; pipes accounting for 9%, down 17 percentage points compared with the highest proportion of 26% in 2009. Wire rod exports accounted for a significant rise, largely because of the export tax rebate policy to reduce the country's indirect costs.

Liucheng steel exports of Asian countries, ASEAN, East Asia, West Asia is the key. 2015 January to October, China's steel main export destinations are Asian countries, together accounting for 66%, which accounted for 31% of ASEAN, East Asia accounted for 14 percent, accounting for 12% of West Asia, South Asia accounted for 8%, in Asia accounted for 1%; steel exports to Europe accounted for 9%, Africa accounted for 8%, North America accounted for 7 percent, South America accounted for 5%. China's geographical location determines the neighboring countries and the Western Pacific Rim countries have become major export destinations.

Comparison of two major national steel export competitiveness

Chinese steel major competitors in the international market is Japan, Korea, Russia, Germany and India. The following international market share, respectively, revealed comparative advantage index and trade competitiveness index three indicators to compare the level of competitiveness of Chinese steel exports and the country above. Then, calculate the comprehensive competitiveness ranking by the variation coefficient method.

Chinese steel rapid increase international market share after 2010. International market share to reflect the status of a country's exports of certain industrial products on the market, more directly reflects the international competitiveness of the country for this product. The higher the index, the stronger international competitiveness. As can be seen from the figure, the international market share of steel products from China in 2010 began a rapid rise was mainly due to China's steel production capacity began to rapidly release significant increase in supply capacity. By country, the main rival of China's exports of long products are Germany, Japan, South Korea; sheet main competitors are Japan, Korea, Germany; pipe main competitor is South Korea, Japan and Germany. 2014, China's exports of long products, sheet, pipe market share reached 31%, 19%, 23%, are ranked first; is worth noting that, due to Chinese restrictions on exports of steel billet and ingot, billet and ingot exports China market share began to rapidly decline from 2009, 2014 was only 1%, ranked last. Recently, the Chinese Ministry of Finance issued a document called the beginning of 2016, will reduce export tariffs on iron and billets this policy, or will China's exports of steel billet and ingot international market share has improved greatly.

Chinese steel trade and international competitiveness index is less than Japan and Russia. International trade competitiveness index reflects the relative value of total trade, its size between -1 to 1. Trade competitiveness index closer to -1, indicating weaker trade competitiveness of this product; the closer to 1, representing the trade competitiveness of the product stronger. Since 2000, Japan and Russia maintain a relatively high trade competitiveness; China is catching up development model, the 2008 financial crisis, China's catch up with the rhythm was interrupted by an increase in 2009 in subsequent years, in 2014 close to the level of Russia and Japan .

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Chinese steel exports revealed comparative advantage index performance is poor, only better than Germany. Revealed comparative advantage index is used to quantitatively describe a country's relative export performance of various industries. Generally, when the index is greater than 2.5, indicating that the country of a product with a strong international competitiveness; when the index is between 1.25 to 2.5, with strong international competitiveness; when the index is less than 0.7, with poor international competitiveness. Overall, Chinese steel production of comparative advantage is not strong, only better than Germany, which weakened the competitiveness of China's steel exports.

2014 China's steel export competitiveness ranking for the first time first. According to the three measurable indicators of international competitiveness, after standardization, the variation coefficient method and other methods to empower, to give six integrated steel export competitiveness rankings. 2014, China's steel exports competitiveness ranking for the first time First, China's main competitors in the international market is Japan, Russia and South Korea.

Third, China's steel export competitiveness SWOT analysis

1, the advantage of China's iron and steel exports

Low price is the biggest advantage of China's steel exports. Steel export price comparison of the six countries, we can clearly see the average price of China's exports of steel at a low level is moderate. 2014, China's steel export price $ 778 / ton, respectively, 40% lower than in Germany, India, Korea, Japan, Russia, 30%, 14%, 14% and 12%. On the one hand, which is China's steel exports are mainly related to low-end products; on the other hand, the absolute price of Chinese steel exports also lower than in other countries. In recent years, increasingly fierce competition in the domestic low-end steel products, companies through large-scale production, internal cost efficiency, etc., greatly increases the comparative advantage of low-end steel products.

2, China's steel exports disadvantage

High-end product competitiveness needs to be improved. China's share in the international market in a few years the plate than just Japan, if we consider the low-cost advantage of Chinese plates, end plates can be seen in China in the field of competitiveness actually less than in Japan. Then from the perspective of steel imports, China in the field of high-end steel varieties competitiveness far and Japan and other countries.

China's manufacturing labor productivity is far lower than Japan, Germany and South Korea. Because it is difficult to find countries in the steel industry labor productivity data, this paper instead of labor productivity in manufacturing labor productivity in the iron and steel industry. According to the Barcelona effect, wage levels in different industries of a country average trend, while wages in turn depends on labor productivity, so this choice instead of using the labor productivity in manufacturing iron and steel industry has a certain rationality. UNIDO data show that China's manufacturing labor productivity is much lower than in Japan, Germany and South Korea. In 2010, for example, China's output per worker $ 106,524, while Japan, Germany and South Korea were $ 475,598, $ 308,206 and $ 403,454; Chinese output per worker were 22 percent in Japan, 35% in Germany, 26% in South Korea.

China's steel industry does not match the technical innovation and steel industry scale. China's crude steel production scale in the world, Japan's 7.5 times, but the steel industry, the number of patents in Japan is only 54 percent. Visible, innovation strength of the Chinese steel industry does not match the scale of the industry. Transfer the previous world steel industry center accompanied the birth of revolutionary technology: the 1860s and 1970s, the United States invented the Bessemer process (1856) and Siemens - 马丁平 furnace steelmaking (1864) and promote the world's steel production center moved from Europe to the United States; in the 1950s, Japan's development of the central enterprises BOF, continuous casting and continuous casting and rolling, and other new technologies, and promote the world's steel production center moved to Japan from the United States. The beginning of the 21st century, world steel production centers when moved to China from Japan and South Korea, but did not appear revolutionary production technology. This example from the reflection of China's steel industry innovation ability is still room for improvement.

3, China's steel exports face opportunities

China's steel exports accounted for not high. Although China's steel exports has leapt to first in the world, but the proportion of exports accounted for crude steel production, China is still at a very low level. 2014, Germany, Korea, Japan, Russia, India's steel exports accounted for respectively 58%, 45%, 37%, 39%, 12%, while China is only 11%, ranked last. From this perspective, China's steel exports still has growth potential.

2016 devaluation larger space conducive to growth in steel exports. Since the 2008 financial crisis, major currencies, except the dollar, the yuan and the rupee appreciation, the other main currencies to depreciate. 2016, devaluation larger space, mainly as follows: First, December 16, 2015, the US dollar began to enter the rate hike cycle, from emerging markets worldwide return to the US dollar, devaluation is expected to rise; Second, the renminbi was added after SDR currency basket China's central bank will push the RMB exchange rate liberalization, remove dirty floating RMB exchange rate will reduce manipulation; three, 811 yuan central parity rate formation mechanism reform, the RMB increased volatility will increase the risk of international hot money arbitrage, renminbi is conducive to the equilibrium level return; four, since November 2014, the central bank cut interest rates several times, interest rates so that the expected return on investment of RMB lower, less attractive and thus will lead to suppression of the renminbi exchange rate. RMB exchange rate decline, will increase the competitiveness of domestic steel exports.

4, China's steel exports face challenges

Factor costs of labor, land and other rising rapidly. 2002-2012, the average annual growth rate of wages is 14.43%, more than the GDP growth rate; "China Labor Statistics Yearbook 2013" Data show that in 2011 and 2012, China's manufacturing workers are nominal wage increase of 14.0%, respectively and 15.3%. Rapid rise in labor costs in China's economic growth, high prices, the demographic dividend to reduce the inevitable result of this trend will be irreversible. It will weaken the competitiveness of Chinese steel exports objectively. In addition to rising labor costs, land and other factor costs rising China will also lead to a decline in steel exports competitiveness.

Global trade slowdown. After the 2008 financial crisis, the global economic slowdown, weak economic recovery in major economies, resulting in global trade slowdown. CPB data show that since December 2014 global trade growth has stalled global trade price index since March 2014 continued to decline, has fallen by 16.2%. Causing global trade plight main reasons: First, the developed manufacturing reflux, intermediate goods imports reduced; difficulty Second, to further refine the global division of labor increased, slowing down the process of globalization; Third, the economic recovery is weak, non-developed countries consumer durables demand must fall. Global trade slowdown indirect instructions slowdown in global aggregate demand, is not conducive to export domestic steel.

Fourth, the foregoing conclusions and policy recommendations

1, the foregoing conclusions

2010 began, with steel production capacity to accelerate the release of China's iron and steel exports increased rapidly, the main export destination is East Asia, ASEAN, West Asia. 2014, China's steel export competitiveness rankings for the first time jumped first in the world, mainly rely on price advantage, where the comparative advantage of low-end steel strongest. Chinese steel exports less competitive problem in high-end product competitiveness, labor productivity is not high, and technological innovation is not enough and so on. Because of China's steel exports accounted for not high, coupled with the RMB real effective exchange rate depreciation of a larger space, the future of China's steel exports there is a large growth potential. However, due to rising factor costs of labor, land and other trade friction cases increased, and the slowdown in global demand, Chinese steel exports also face greater challenges. On the whole, in 2016 China's steel exports also room for growth, a conservative estimate of an increase of around 10%.

2. Policy Recommendations

Iron and steel enterprises to reduce the tax burden. In the context of steel prices continued downward, shrinking corporate cash flow, repayment pressure and heavier. Although the central bank cut interest rates several times lower this year associate, to some extent reduce the financial cost of steel and mining companies, but the intensity was still inadequate, with the tax cuts should also be proactive fiscal policy, further reducing the burden for businesses.

Reduce steel and intermediate goods export tax. This year, foreign against China dual investigation of cases increase, the department to improve the protection of the country of import tariffs, making Chinese exports face greater resistance, it is necessary to lower steel export tax, increase export competitiveness.

Conditionally reduce or eliminate export tax rebates. Recently, there is a growing trend abroad for the "double reverse" investigation cases of Chinese steel exports to reduce similar trade friction, China is necessary to reduce or cancel the conditional part of the export tax rebate varieties of steel. The other hand, from a macro level, the elimination of export tax rebate helps to reduce the financial burden, the RMB exchange rate will help a return to equilibrium level, contribute to the elimination of backward Forced domestic manufacturing transformation and upgrading, thus the elimination of export tax rebates within the long-term national policy Required the steel industry should be prepared in advance.

Increase business investment to upgrade and improve labor productivity. Encourage large enterprises to strengthen scientific research, production of high-end steel products, or increase the level of automation industry, the first to achieve industrial upgrading, improve labor productivity, reduce operating costs.

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