China’s Tangshan Orders Further Production Cut over Summer Season

China is cracking down on pollution like never before with its new green policies. With the start of this month, China has unveiled the pollution control strategy for 2018-20, which proposed extending winter output cuts to 80 cities as compared to 28 cities covered last year. It also included ending trucking of iron ore and coal in major ports by 2020.

Now as per the latest reports, China’s top steelmaking city, Tangshan in Hebei province has ordered steel mills, coke producers and utilities to cut output not only in winters but also extend the same over the ongoing summer season. The move to deepen the cut will last for six weeks from 20 Jul’18 to 31 Aug’18. These production cuts will be in addition to the winter production curbs of 10-15% imposed from Mar-Nov’18.

Although the quantity of cuts that will take place has not been instructed in the order issued, industry experts believe that the latest restrictions will result in hot metal output reduction up to 150,000 tonnes per day.

It is likely that blast furnace and sintering operations will face restrictions as much as 50% depending upon the emission level at mills. According to the notification, plants that have not installed desulphurisation and denitrification equipment need to cut output.
The city aims to reduce sulphur dioxide emissions by 31%, nitrogen dioxide emissions by 21% and carbon monoxide emissions by 24% by the end of Aug’18 compared to average emission levels in the first-half of 2018.

In the start of July month, Tangshan has also announced its plans to halve the number of steel producers in the city by 2020. The city which is home to 64 steelmakers has produced 92.7 MnT of steel in 2017 (11% of China’s total steel output) aims to have less than 30 steel mills by 2020 and cut it further to around 25 by 2025.

The city plans to phase out blast furnaces with an annual production capacity of less than 1 MnT by 2020 and converters used in steelmaking, with an annual capacity below 1.15 MnT and sintering machines smaller than 180 square meters are also planned to be scrapped.