Shandong Liaocheng Seamless Steel Pipe Factory: Steel Traders Call for an End to Local and Industry Protectionism
An operator engaged in scrap steel trade explained: "In the scrap steel trading sector, tax policies vary across regions. For instance, in the recycling phase, although the new fiscal and tax policies for scrap steel have been implemented, there remains a gap compared to the requirements of a unified market. Additionally, there are differences in the collection of stamp duty on commodity transactions across regions, with varying standards for different types of enterprises. The general requirement is a levy of 0.03% on the procurement and sales amount. However, bulk commodities typically have high unit prices and low profit margins in the trading phase, resulting in higher tax costs for trading enterprises. Establishing a national unified market would effectively reduce transaction costs, promote resource circulation, and stimulate trading activity."
For this very reason, steel trading enterprises place great hopes on establishing a unified national steel market. They express their intention to optimize point-to-point upstream and downstream logistics distribution and resource allocation, reduce intermediate circulation links, and lower circulation costs. By integrating spot and futures services to help steel-using enterprises manage costs, the steel trading industry aims to demonstrate its service value in circulation links, provide high-quality resource allocation and distribution services to upstream and downstream steel enterprises, and contribute to the construction of a unified national steel market.
Ren Qingping believes that steel traders who have survived the market test generally possess highly mature procedures and professional experience in procurement management, quality inspection, logistics, and capital operations of steel products, which are the result of market economy division of labor and cooperation. "We hope that local governments, steel mills, and central state-owned enterprises can correctly grasp the laws of market operation from the perspective of a unified market, create a fair and competitive environment for the steel market, and take 'eliminating institutional barriers that hinder the market-based allocation of various production factors and the circulation of goods and services' as the core goal of further reducing market transaction costs. A series of measures such as 'strengthening the unification of market foundational rules' should be introduced; the 'national unified list' management model must be strictly implemented, breaking regional protection for local steel brands; a unified fair competition system should be maintained, comprehensively eliminating discriminatory policies against foreign and out-of-region enterprises and local protectionism, effectively avoiding policy disparities between state-owned and private enterprises in steel products, thereby achieving a truly unified national seamless steel pipe market," he said.
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