The provincial government of Shandong, a coastal province in North China, has sent out a notice recently requiring that the crude steel output of the province should not exceed 76.5 mn t in 2021, SteelMint came to learn from sources in China.
The steel output ceiling for 2021 has been fixed based on the output of iron and steel enterprises of the province in 2020. The provincial government’s survey requires output to be reduced vis-à-vis last year.
If the capacity is transferred, as part of China’s steel swap programme, it should be reduced according to the converted capacity, which takes into account environmental protection, energy consumption and capacity utilisation so as to determine the output control objectives of each company, sources divulged.
Production cuts amid surging output
Not just Tangshan, major steel mills in many provinces, including Shanghai and Chongqing, have reportedly received verbal orders to restrain production within 2020 levels. Mills that have breached steel output in H1 CY’21 compared with the same period last year are under pressure to ensure that their annual production do not exceed 2020 levels.
Despite best efforts by the authorities to slash crude steel output at outdated mills with poor environmental performance and ensure that China’s 2021 steel output falls from that of the previous year, the world’s second-largest economy has already produced 563.33 mn t of steel in the Jan-Jun’21 period, up 11.8% from a year earlier.
Photo courtesy : World Steel Association
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