China will cancel export tax rebates on super high-grade refined zinc and silver from 1 August, the State Administration of Taxation said on Thursday.
Super high-grade zinc had been entitled to a 5% export tax rebate, which has encouraged smelters to export that grade this year.
China is the world's top producer of zinc, which is used as a galvanizing agent on steel and other metals. Galvanized steel is widely used in the building and infrastructure sectors.
"Rebate removal on zinc should not have a big impact as China's imports have fallen," said Wang Jianjun, trading director at Zhuzhou Smelter, the top zinc producer in China and a subsidiary of Hunan Non-Ferrous Metals.
China exported 40,873 tonnes of refined zinc in the first half of this year, down 78% from a year earlier, the official data showed.
The removal of the 5% rebate on exports of silver could have a big impact on sellers, Wang said.
China produces more silver than it needs and is a major global exporter. It supplied 2,393,944 kilograms of silver to the global market in the first half of this year.
From 1 August, China will also remove tax rebates on exports of cadmium and zinc-manganese based batteries.
Reporting by Polly Yam and Jim Bai, Reuters.
