1. According to the statement released by the news spokesman of National Development and Reform Commission, Chinese steel price was recovering from the second and third ten-days of December 2015 and growing rapidly since March 2016, but the steel price declined since May 2016.
MPI's comments: Chinese steel price rises mainly driven by market expectations and short-term factors, which cannot change the relationship between supply and demand. The steel industry is still confronted with serious over capacity. It is difficult for steel price grows continuously and rapidly. Recovery of steel price only imposes small impact on elimination of over capacity. Reproduction is a kind of operation adjustment carried out by steel companies complying with market condition.
2. According to the notice released jointly by the Ministry of Finance and State Administration of Taxation on May 10th, reform of set taxes on the basis of their prices will be carried out for other mineral resources besides coal, raw oil and natural gas, which will be executed from July 1st 2016.
MPI's comments: At present, resources tax of majority minerals are set on the basis of quantity,which cannot be adjusted automatically complying with price change failing to satisfy the development of mining market.
