Chinese steelmakers are increasingly bypassing global tariff barriers by ramping up exports of semi-finished steel billets—products not currently subject to many countries’ trade duties. Between January and May 2025, China exported 4.72 million tonnes of billets, marking a threefold year-on-year increase and representing nearly 10% of its total steel exports. Key markets such as Indonesia, Turkey, and Saudi Arabia have become major destinations due to the absence of tariff restrictions on billets, allowing Chinese mills to reroute shipments profitably and avoid higher duties on finished steel products.

However, this export strategy has sparked internal debate within China. The China Iron and Steel Association has urged producers to prioritize higher-value finished goods instead of relying on low-margin billets. In response, Chinese authorities are reportedly considering new export taxes on billets to curb the trend and align with long-term industrial policy goals. The surge in semi-finished exports is drawing criticism from international trade bodies, as it challenges the effectiveness of existing tariff regimes and may prompt importing countries to introduce stricter trade defense measures to protect their domestic steel sectors.