Jiangsu to complete trimming coking capacities by 2020
Source: Mysteel
Aug 17, 2018 11:30
All the independent coking plants located along the Yangtze River and in the Taihu Lake area, both in the southern part of Jiangsu, will be the first batch to be dismantled by the end of this year, and all the others located elsewhere in Jiangsu will have to be cleared by the end of 2020, according to a government notice dated on August 7 that has been circulated online in China.
The shut-downs of all the coking plants are to reduce coal consumption and reduce pollution from the coking process, as Taihu, China's third-largest freshwater lake and a source of water for over 20 million local residents at the Yangtze River Delta, is under consistent threat of pollution, Mysteel understands.
Steel producers in Jiangsu that have their coking plants located inland instead of coastal areas have been requested to scrap all of their coking capacity by 2020 too, while those with blast furnace above 5,000 cu m are allowed to keep two coking furnaces higher than 7 meters. As far as Mysteel knows, Jiangsu Shagang Group, the biggest private steel enterprise in China, has such kind of blast furnaces.
Xuzhou, the top coking base in Jiangsu, has been specifically requested by the provincial authorities to cut its current coking capacity by 50% via the means of consolidation, relocating or upgrading, and by the end of 2020, Xuzhou will only be operating two to three large-size independent coking enterprises instead of eleven at present.
Jiangsu is with limited coking capacity, and in 2017, it produced 20.6 million tonnes of coke, or only 4.8% of the country’s total, while it is China’s second largest steelmaking base after Hebei with 104.3 million tonnes of crude steel production in 2017, accounting 12.5% of the country’s total, according to the data from China’s National Bureau of Statistics.
Officials from Jiangsu-based steel mills declined to comment on the possible affection on their operations, and Mysteel estimates around 18 million tonnes/year coking capacity to be removed by 2020, with 9 million t/y to survive the elimination battle.
“The affection of the shut-downs on the local steel mills, however, may not be so significant, as they, including those with their own coking capacity, have been sourcing coke from other provinces anyway,” a Shanghai-based analyst commented.
Meanwhile, the price of coke with 13% ash and 70% sulphur in Xuzhou, Jiangsu, has been largely stable, up Yuan 100/tonne ($14.5/t) on week to Yuan 2,400/t including the 16% VAT as of August 16, around the same level as the average national coke price at Yuan 2,273/t incuding the 16% VAT.
Written by Victoria Zou, zyongjia@mysteel.com
Edited by Hongmei Li, li.hongmei@mysteel.com
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