China's metal exporters face order cancellations, damage claims amid virus: trade group

BEIJING (Reuters) - Some overseas buyers of Chinese metal products have stopped accepting shipments amid the coronavirus outbreak, while other clients - including from India - are seeking damages due to a failure to deliver on time, a China trade body said on Tuesday.

Companies in places such as Russia, Turkey, the Middle East and North Africa have informed Chinese suppliers they are not accepting deliveries, or asked if they can suspend purchases, the Metallurgical Council of the China Council for the Promotion of International Trade said on its website.

At the same time, some international customers, such as from India, are seeing that Chinese companies cannot deliver on time and are requesting damage payments, the state-backed body added, without naming any of the firms or specific products involved.

China is the world’s biggest metals consumer but also the top exporter of some industrial metals, such as steel and aluminum.

Its metal output is set to drop sharply as large numbers of staff are unable to go to work due to quarantine requirements in the wake of the epidemic. Companies also are struggling to secure raw materials or ship out products amid transport curbs aimed at stopping the spread of the virus.

Steel exporters face a dilemma of whether to ship product via sea or rail and cannot guarantee delivery in light of the epidemic, the council said, noting that inland transportation costs had surged and seaports were operating at low efficiency, which is also affecting deliveries.

“Some countries have started to close border crossings, making customs clearance very difficult,” it added.

An official from the metallurgical council told Reuters the group’s annual International Steel Market and Trade Conference, which was due to take place in eastern China’s Shandong province in late March, has been postponed due to the epidemic, joining a long list of major events to have been canceled or delayed.

Reporting by Tom Daly and Min Zhang; Editing by Kim Coghill