World’s largest steel producer, China seems to implement some of its strictest cuts to steel production in a bid to restrict the choking pollution from steel companies and further consolidate a fractious industry.
Last year as a part of its anti-pollution campaign, China had ordered its 28 northern cities to cut the steel output by half during winter heating season from Nov’17 to Mar’18.
However, post-March, few cities such as Handan and Tangshan in Hebei province extended these production cuts till Sep’18 and Nov’18 respectively as a part of ‘Non-Heating season steel production cutbacks’ in order to have clearer skies.
Now according to the latest updates, following Tangshan and Handan, China’s Xuzhou city in Jiangsu province and Guangdong province has also issued orders to extend production cuts in ‘Non-heating season’ in a bid to meet state air quality standards.
Closure of steel mills in Xuzhou city, Jiangsu province
As per the market sources, at least three steel mills in the Chinese city of Xuzhou in Jiangsu province have currently suspended their operations amid local authority orders to shut down plants until they meet tough anti-pollution rules.
These three plants have combined a capacity to produce 4.25 MnT of steel per year which is one-third of the Xuzhou’s total steel-making capacity. However, the status of other mills in Xuzhou remains unclear.
The local authorities had ordered all steel plants in the Xuzhou city to shut until they meet the latest tough requirements aimed at cleaning its notoriously toxic air. Earlier this month, the city launched six months of environmental inspections at industrial plants and construction sites as part of its 2018 action plan to clean its skies.
Although the EAFs and mini-mills that uses scrap and emit less carbon as compared to blast furnaces hoped that they would be exempted from these closures, the local authorities ordered suspension of production activities of such mills until they pass a test conducted by a third party environmental detection agency which is not likely to happen before the end of May’18.
Xuzhou city is a hub of 13 MnT of steelmaking capacity in the eastern province of Jiangsu, China’s second-biggest steel producing province after Hebei.
The city is under particular pressure to deal with the problem of rising pollution levels because its average concentration of hazardous, breathable particles known as PM2.5 in the month of Apr’18 have been 110 micrograms cubic per meter up against last year and almost double against the city’s aim of 60 micrograms cubic per meter for 2018 according to the data released from China’s National Environmental Monitoring Centre.
China’s Guangdong Province Plans Special Emission Curbs on Steel
China’s south-eastern manufacturing hub of Guangdong is planning to impose tougher emission curbs on its steel plants and also petrochemical and cement companies starting from June as it bids to meet state air quality standards.
The province’s local environmental protection authorities has recently announced that these industrial emissions curbs will be extended to the entire province as it aims to bring average concentrations of hazardous, breathable particles known as PM2.5 to around 30 micrograms per cubic meter by 2020 and the firms that do not meet the new requirements will be subject to punitive measures, including production restrictions, fines, and even closures.
The 9 MnT per annum Zhanjiang steel base run by the Baowu Iron and Steel Group is located in Guangdong province and the region produced 28.9 MnT of crude steel last year, up 25% against 2016. The province is a major part of the Pearl River Delta, which was one of the few regions to meet China’s national 35-microgram air quality standard in 2017.
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