China revises minerals export tariffs in 2017

By Albert Li, Yoke Wong
Published: Thursday, 26 January 2017

Following WTO complaints from the EU and US, China scraps graphite and magnesia tariffs, while apatite export duty cut by 5 percentage points.

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China has rolled out provisional tariffs on a number of minerals, with effect from 1 January 2017, according to the country’s Ministry of Finance on 19 December 2016.  


Under the revision, China will cut its existing export duty for apatite to 15% in 2017, down by five percentage points compared with 2016.

At the same time, the country will reduce the export duty for NPK (nitrate-phosphorous-potassium) fertiliser to 20%, from 30% in 2016. The government will continue to implement 1% of the provisional tax rate on ammonium phosphate fertiliser exports.   

Export taxes for antimony ore, metal and related products will remain unchanged at 20%.

Graphite and magnesia duty cancelled

In December 2016, China cancelled its export duties for natural flake graphite, magnesia and magnesite products.   

The State Council of China approved an export tax adjustment on partial products, including the cancellation of export taxes on graphite, magnesia and magnesite, effective 1 January 2017.

Natural graphite exports were previously subject to a 20% tariff.

Although removing the tariff suggests that China is further opening graphite up to the world market, in December the country added flake graphite to its list of strategically important minerals, along with fluorspar and rare earths, "for further protection".

Instead, the cancellation is considered to relate to a World Trade Organization (WTO) case in the summer of 2016, when both the US and Europe complained about China’s export tax on 11 source materials, including graphite.

In August, China responded that the export tax on these products was not only helpful to sustainable development, reasonable use of resources and the environment, but also insisted that it complies with WTO regulations.

Exports of magnesite and caustic calcined magnesia were subject to a 5% tax while fused magnesia (FM) and dead burned magnesia (DBM) exports had a 10% tariff.

In November, export quotas for magnesia disappeared from the government list release for 2017.

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Graphite cancellation

The impact of the graphite tax cancellation is not yet known. 

Some market participants contacted by IM said they believe it may lead to an improvement in profitability if the price is sustained. However others fear that a price war may ensue if small competitors opt to reduce their prices by the 20%, given the already tight margins producers are operating with.

Australian tariffs

China has further reduced its tariffs in 2017 under free trade agreements (FTAs) with Australia, Pakistan, Switzerland, Costa Rica, Iceland, South Korea, New Zealand and Peru. 

Tariffs for Australia-origin minerals, including lithium and titanium dioxide (TiO2) feedstocks, will be scrapped this year. China imports most of its spodumene from Australia.