New steel export requirements cause confusion
New certification requirements for steel exporters introduced May 20 have  caused confusion in the industry and led to the postponement of some export contracts, Shanghai Securities Journal reported. Unclear requirements and a lack of supplementary information have been blamed for many traders failing to apply for certification at local commerce bureaus as required. The new steel export certification and management system does not include quotas or minimum standards, but China Iron & Steel Association (CISA) vice chairman Luo Bingsheng said the system provided the government with a preliminary framework to regulate export volumes, competitiveness, and energy-saving and environmental measures. CISA data shows there were 11,600 steel exporters last year, indicating an industry ripe for consolidation.

Beijing urges plastic bag cull in supermarkets
The Beijing Municipal Bureau of Commerce (BMBC) called for retailers to cut back on plastic bags and packaging at the 12th Beijing Commercial Technology Week in order to control an escalating plastic pollution problem, the Beijing Star Daily reported. The BMBC said it would instead promote paper and cotton bags and packaging. It would also survey current usage patterns and encourage firms to form recycling and re-production systems for recycled materials. According to a 2006 report released by the China Chainstore & Franchise Association, supermarkets greater than 8000 square meters in size spend more than US$51,000 (RMB400,000) on average on packaging materials each year, accounting for 0.5% of the annual sales volume of each outlet.

E&Y advises Everbright restructure
China SAFE Investments Limited has hired Ernst & Young to audit Everbright Group and Everbright Bank ahead of a restructuring of the former and listing of the latter, the Shanghai Securities Journal reported. SAFE is expected to inject US$2.58 billion (RMB20 billion) into Everbright Bank and become its core stakeholder ahead of a public listing this year, while Everbright Group is likely to be divided into Everbright Finance Holdings and Everbright Property. An Everbright Bank senior manager refused to say where the bank was planning to list, or disclose the fundraising target. Market sources close to the situation said planned listings of Ningbo City Bank and Nanjing Bank have been delayed because the government wants Everbright Bank to go public first.

McKinsey releases Chinese shopper insights
Retailers hoping to turn a profit in China need a better understanding of how, why and where consumers shop and not just what they buy, a new survey  by global consultancy McKinsey & Company shows. China Business News reports that the survey showed that Chinese consumers spent more time shopping than their counterparts in other countries, viewed it as a form of entertainment and showed a preference for fresh, high quality products. They were also found to be less loyal to individual retail stores, but could be encouraged to buy brands or additional products if suggested by a shop clerk. McKinsey said many retailers failed in the Chinese market because they lacked a clear understanding of how Chinese consumers shopped. The consultancy recommended retailers use in-store promotional activities to stimulate Chinese proclivities to impulse purchasing, and ensure high product density and streamlined supply chains to keep costs low in the low margin market.

SZSE concerned over affiliated transactions
A Shenzhen Stock Exchange (SZSE) analysis of the fiscal reports of its 490 listed companies identified a worryingly high rate of transactions involving affiliated companies, the China Business News reported. 270 companies, or around 55% of the total, sold shares to affiliated companies, accounting for sales revenues of US$15.4 billion (RMB119.39 billion), or 10% of core business revenues. A further 266 purchased from affiliated companies, accounting for US$23.719 billion (RMB183.823 billion) in purchases, or 18% of total core business expenditure. The SZSE report also said that most listed companies showed strong growth in operational revenues and profits in 2006, although 69 listed companies, or 14.08%, were evaluated as having poor profitability, poor asset quality and high financial and operational risks.