Shagang deepens production cuts for Shanghai expo
The CIIE opened Monday at Shanghai’s National Exhibition and Convention Center and will run until Saturday November 10. The Expo is China’s first international imports event, with delegates from over 130 countries and regions expected to attend, as Mysteel reported.
As its sprawling Zhangjiagang works is only 115 kms from the exposition’s venue, Shagang was among the first steelmakers in the region to announce production restrictions to help ensure that skies remain clear for the event. Weeks ago, it pledged to bank three 480 cubic meter and two 580 cu m blast furnaces over November 1-15, affecting approximately 110,000 tonnes of molten iron, as reported.
Mysteel understands that in addition, beginning November 3 the company has banked another 2,500 cu m blast furnace and reduced to half-capacity another 5,800 cu m unit. Shagang has issued no statement and officials from the company could not be reached on Monday but sources with knowledge of the matter have confirmed the cuts.
Currently Shagang is producing approximately 20,000 tonnes/day of molten iron, only 40% of normal production, Mysteel understands. When exactly the two large units will be brought back into full operation is not known but this is unlikely to occur before CIIE closes.
The steel giant’s decision to make additional production cuts reflects the privately-owned mill’s commitment to preserving air quality in Shanghai and surrounding regions during such “a crucial and profound international event and one the central government regards as very important,” a Shanghai-based industry source explained. China’s President Xi Jinping is visiting Shanghai for CIIE this week, Mysteel notes.
As of November 4, Shanghai’s air quality index (AQI) was quite stable, recording a satisfactory 54, though outside the reading of cities with the cleanest air whose AQI should be at 0-50, according to the daily AQI report from China’s Ministry of Ecology and Environment which monitors air quality in 367 cities.
Despite the additional upstream reductions, Shagang’s total output of finished steel products is unlikely to be impacted to any great extent, a second Shanghai-based industry source said. The mill has stocked sufficient semi-finished products including billets to last the duration of the Expo and as its rolling operations have not be curtailed, Shagang’s downstream production can continue.
Written by Venus Wang, wangyi@mysteel.com
Edited by Russ McCulloch, russ.mcculloch@mysteel.com
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