How Much Deposit Is Normal for a China Steel Order?
The classic 30/70 split exists for a reason. Here is what deposit level is normal, when a demand for more is a warning sign, and how to protect the balance.
One of the most common questions from first-time steel importers is simply: how much should I pay up front? Get it wrong and you either expose too much cash to a supplier you barely know, or you price yourself out of the deal. The good news is there is a well-established norm, and deviations from it are a useful risk signal.
The 30/70 benchmark
The most common structure for a China steel order is a 30% deposit to start production, with the remaining 70% paid against shipping documents or after a satisfactory pre-shipment inspection. This split balances the supplier's need to fund raw materials against your need to retain leverage until the goods are made and verified. Some suppliers accept a lower deposit for repeat customers; some categories with volatile raw-material costs push for slightly more.
When the deposit demand is a red flag
- A demand for 100% up front, or 50%+ from a brand-new supplier, concentrates all the risk on you.
- Pressure to pay the full amount 'because steel prices are moving' before any production evidence.
- A request to split payment to a different, personal, or offshore account — a classic redirection scam.
- Refusal to tie the balance to inspection or shipping documents.
A deposit funds production. A supplier who wants the balance too before you can verify anything is asking you to fund their cash flow and carry all the risk.
How to protect the balance
- 1Keep the deposit near the 30% norm and resist upward pressure from unproven suppliers.
- 2Make the 70% balance conditional on a passed third-party inspection or clean shipping documents.
- 3For large orders, consider a letter of credit so the bank controls release against documents.
- 4Verify the company and its bank account belong to the same legal entity before wiring anything.
The deposit level is only half the equation — how you structure the balance is what actually protects you. Pair a normal deposit with inspection-linked balance terms, and read the guide on safe payment terms for a first order for the full playbook.
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