China’s second-largest steelmaking province, Jiangsu, will require steel mills to move to two new areas on the coast in the next few years, according to a provincial government document, to reduce air pollution and to make the industry more efficient. After years of getting rid of outdated excess capacity, the latest measures are the next front in the government’s long-term effort to upgrade and streamline its smokestack industries.
The plan was distributed on Tuesday by the Jiangsu government. The document said “Jiangsu province, which accounted for 12.5 percent of China’s total crude steel output last year, plans to create two steelmaking hubs, focussing on high-quality steel production, and relocate steel mills through merger and capacity trading. “Jiangsu will guide and encourage steel companies to adopt electric-arc furnaces (EAFs) and to produce high-end steel products used in military defence, rail, nuclear, aerospace and new energy vehicles industries.”
In the document, Jiangsu explicitly ordered the city of Xuzhou to cut number of steel mills in the city to under 10 by the end of 2018 from 18 currently and consolidate the remaining into one to two companies by 2020. In April, at least three steel mills were ordered closed in Xuzhou.
Small steel mills and coke plants near the Yangtze river and Tai Lake region will be eliminated by 2020.
The move is similar to one outlined by Hebei, the country’s top steel producing province, earlier this year.
Source : REUTERS
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