For the iron and steel industry, which is plunged into a quagmire of losses, relevant departments are brewing support for the corresponding industry policies. According to sources close to the Ministry of Industry and Information Technology, the Ministry of Industry and Information Technology (MIIT) is brewing the recovery of the policy of “producing top-quality products” in order to help steel companies get out of difficulties, and has already begun to vigorously promote the transformation of major steel mills from manufacturers to integrated service providers.

The brewing and recovery of “recruiting for production” refund of value-added tax It is reported that the Ministry of Industry and Information Technology is brewing plans for the steel industry to restart the “production-for-lifting” policy. The varieties are mainly based on silicon steel and ship steel. At the same time, relevant departments also brewing additional steel tax cans, refinement of tool steel, oil pipes, coated steel and other steel products tax items.

Under this policy, approved iron and steel enterprises are sold to processing and exporting enterprises for processing and exporting "special steel for processing and exporting" at a tax-free price, and a full refund (or exemption) of 17% value-added tax is implemented. High-end products for export are also expected to receive more targeted fiscal support.

In 1998, the State issued the policy of “progressive production” for steel products, that is, the listed steel companies that have been approved to sell processed steel products to processing and exporting enterprises for processing and producing export products at tax-free prices. 17% VAT refund (later changed to exempt). From 1999 to 2001, the State Economic and Trade Commission, the Ministry of Finance, the State Administration of Taxation, and the General Administration of Customs jointly issued operational rules and gradually improved this policy. In 2005, the policy was cancelled.

The purpose of “progressive production” aims to further expand the demand for steel mills, promote the localization of products that originally required large amounts of imports, and encourage processing and exporting companies to use domestic products. This is a strategy for converting some external demand into internal demand by improving supply. For steel mills, the market demand for some high-end products can be increased in the short-term, and in the long-term, the trend of restructuring and industrial upgrading will be highlighted.

Previously in the metallurgical industry, among 27 top-listed companies, listed companies accounted for 70%. Wuhan Iron and Steel, Benxi Iron and Steel, Maanshan Iron and Steel, Heavy Steel, Panzhihua Iron and Steel, Handan Iron and Steel, Laiwu Steel, Angang and Hualing have become "Just into" better companies.

Encouraging the transformation of steel mills into comprehensive service providers In addition, in order to tap the “third profit source”, the Ministry of Industry and Information Technology is strongly promoting upstream and downstream cooperation programs, with Baosteel as a demonstration, requiring major steel mills to increase cooperation with downstream customers in the field of logistics and services. Effectively tap the sales potential, and vigorously promote the transformation of major steel mills from producers to integrated service providers.

People close to the Ministry of Industry and Information Technology disclosed to the Hong Kong Securities Daily that on Friday, the Ministry of Industry and Information Technology and the Department of Equipment held a meeting to promote the industry’s upstream and downstream in-depth cooperation system as an example. The first promotion is silicon steel as the main demonstration variety.

Prior to this, the steel industry had been calling for steel mills to strengthen their logistics distribution and product services, from producers to integrated service providers, but the level of development of the factories was uneven. The Ministry of Industry and Information Technology is pushing “upstream and downstream cooperation” at this time, and it is undoubtedly hoped that the steel mills can make the market mechanism play a decisive role in accelerating the transformation and upgrading of the business when it is difficult for the smelting business to make significant improvement in the short term.