The move to abolish export subsidies will most likely further increase costs for foreign steel makers who depend on Chinese suppliers, said Reuters.

The Ministry of Commerce announced the reform last week and was waiting on approval from the State Council.

The reform includes cutting the rebate rate, strengthening central government’s support for export rebates, sharing export rebates with local governments, promoting foreign trade system reform, readjusting export product mix, and bearing accumulated short rebates by central government.

With a summer full of power shortages looming, the Chinese government has also ordered miners to forego export profits and keep thermal coal for domestic use. China plans to cut coke exports by about a third this year, issuing export licences for less than 10Mt compared with nearly 15mt last year, McCloskey News said.

European Union negotiators are still trying to reach an agreement with China to end restrictions on coke exports.