World’s largest steel producer, China is carrying out capacity overhaul over past few years amid the environmental concerns. Thus, as a part of this revamp, iron and steel capacity in China is gradually set to transfer from the north to the southern regions.
The country is promoting replacement of blast furnaces with EAFs as these are more environment friendly resulting which electric furnaces will increase each year till 2023.
In 2019 and 2020, China’s net EAF capacity is set to grow by 21.4 MnT, with 13.2 MnT in 2019 and 8.19 MnT in 2020. The year 2019 is expected to see a net rise of 12.78 MnT of blast furnace capacity, 12.01 MnT of converters and 13.22 MnT of EAFs. For 2020, a net reduction of 12.83 MnT of blast furnace capacity and 13.16 MnT of converter capacity, but a net increase of 8.19 MnT of EAF capacity is being estimated.
Region-wise capacity revamp
China’s largest steel making province, Hebei will see complete elimination of 14.03 MnT of steelmaking capacity in 2019. However, over the time span of 2020-2023, the province will see a net loss of 31.7 MnT of pig-iron-producing capacity and 17.03 MnT of steelmaking capacity.
Another steelmaking centre in east China, Jiangsu province is likely to see a net gain of 3.65 MnT of pig iron capacity and 2.48 MnT of steelmaking capacity in 2020-2023.
As mentioned above, Southern China will see increase in the steel making capacities. During 2020-23. The southern Chinese region will witness a net increase of pig iron capacity by 9.23 MnT and steelmaking capacity by 10.48 MnT. Guangxi province will likely emerge as a new steel-making centre in south China as a slew of new projects will come online in the coming years, according to announcements in 2019. About 50.4 MnT steel making capacity is being constructed in the province with Hebei Jinxi Iron and Steel, Hebei Jingye, Guangxi Liuzhou Iron and Steel marking their presence in the province.
The domestic production of steel products is being anticipated rise in 2020 against the backdrop of higher capacity utilisation rates amid capacity replacement. Rising supplies this year have kept prices of steel products lower from a year ago.
Inputs from SMM
Leave a Reply