In an environment of global overcapacity, Chinese steelmakers have been last to reduce production, continuing to make steel at a breakneck pace despite a slowing economy. As a result Chinese steel prices have plunged 13% in the past three months, while exports have risen 31%.

Finally last Thursday, Beijing broke its silence saying that steelmakers need to “curb production and eliminate backwards capacity due to structural problems and retreating market demand.” Tonight the other shoe has dropped, as Beijing is now leaking to the Chinese press that they are “reviewing” increasing export tax rebates on steel, for the first time since… more.

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