Prime Minister John Key says he has heard nothing about potential retribution from China if we impose sanctions on them dumping steel into the New Zealand market.

Prime Minister John Key has downplayed fears of a trade war from China if sanctions are slapped on its steel, saying he has received "no indication" the world superpower is upset with New Zealand.

However, Kiwi trade officials have been asked to "seek assurances" from the Chinese embassy about the country's stance on competition issues, as local exporters worry about a backlash.

Highly-placed sources said China is applying pressure in an attempt to sway regulators at the Ministry of Business, Innovation and Employment (MBIE) away from imposing anti-dumping or countervailing duties - which are imposed when goods are subsidised - on cheap imported Chinese steel.

FENG LI/GETTY IMAGES Prime Minister John Key says he's yet to hear from Chinese President Xi Jinping or the embassy about any concerns.

A complaint has been lodged by local steel producer Pacific Steel. However, MBIE's acting trade and regulatory cooperation manager Karl Woodhead said the ministry could not confirm or deny if it had been received.

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SAM SACHDEVA/FAIRFAX NZ Prime Minister John Key says he has received "no indications" from China that it is concerned about any potential sanctions on its steel.

Labour and NZ First has called on the Government to show it is control of the situation and can protect New Zealand exporters.

Speaking shortly after his arrival in Indonesia for a three-day trade trip, Key sought to pour cold water on the idea of any Chinese retaliation.

While he could not confirm whether MBIE had received a complaint about steel dumping, due to the confidentiality of the complaints regime, the Government had received "no indications" of Chinese concerns about possible anti-dumping duties, or potential retribution.

"Even if there was a complaint, and even if it was investigated, whether a country like China would take retaliatory action against New Zealand, I don't believe that's the case that they would.

"There'll be lots and lots of ways of them looking to resolve issues if there were any, but it wouldn't be through the sort of things that we've seen reported."

EXPORTS 'FLOWING' INTO CHINA

Key said there was no "substantiated source" confirming that China would take action against New Zealand exports, only speculation.

"People can have their own version or view ... of what they think might happen, but our exports are flowing across the border into China.

"I regularly see the Chinese leadership, the Chinese ambassador has my phone number if he wants to pick it up and make a phone call - none of those things have happened."

Trade Minister Todd McClay said he had met China's trade minister last week at a G20 meeting, and no competition issues were raised.

OFFICIALS 'SEEKING ASSURANCES'

However, McClay had asked officials from the Ministry of Foreign Affairs and Trade to speak to the Chinese embassy on Monday morning and "seek assurances" about the country's position on competition issues.

McClay said he had no concerns about imported Chinese steel coming into New Zealand.

"We're a trading nation, we sell a lot of things to China and other parts of the world, and we import a lot of things from them as well, so in as far as our trade relationships are concerned, with China it's very strong."

The world's biggest trading nation is angry New Zealand may launch a probe into Chinese steel imports, believing New Zealand is part of a US-led alliance to target Chinese steel exports.

In response to the complaint, China has signalled moves to undertake "industry consultation" - the first step towards measures that could impose non-tariff barriers that would slow down key New Zealand agricultural exports, including dairy, wool and kiwifruit.

Highly-placed sources have confirmed China is applying pressure. Zespri and Fonterra are said to have been heavied, and other exporters may have been - news that has alarmed local producers.

Chinese ambassador Wang Lutong said there was no issue with the imported steel quality but the embassy had been discussing the industry's concerns with New Zealand authorities.