Beijing promotes optimization in steel location, products
Source: Mysteel
Nov 21, 2018 11:40
The document – Industrial Optimization Guidelines, released on November 15, shares Beijing’s suggestions on the development of industrial sectors such as steel, ferroalloys, graphite electrode, machinery manufacturing, consumer goods, and electronics and information technology, divides the whole country into four regions of Northeast, East, Central and West China, each of which should have a different emphasis on their regional steel development in the years to come.
Over 2016-2018, China will accomplish the mission of erasing 150 million tonnes/year steel capacity and it also succeeded in removing the 120-140 million t/y induction furnace steel capacity by June 2017, though the threat of oversupply is always hovering in the background.
The next few years will be crucial for the Chinese steel industry to seek sustainable development via more balanced supply structure and individual regions and mills having their niche markets, Mysteel understands.
In the document, Beijing suggests Northeast China against any more steel capacity expansion, East China is advised to develop higher quality and value-added steel suppliers, while Central and West China, still with steel undersupply, may consider shutting down those steel capacities without competitiveness and moving mills within proximity of raw material supplies and potential markets, according to the MIIT release.
Beijing names 13 provinces as well as Hebei, and Beijing, Tianjin, Shanghai, Xinjiang Uygur Autonomous Region, suggesting no steel capacities to be built in these areas despite of the legitimacy of old-for-new steel capacity swaps.
In the categorization, Northeast China includes Liaoning, Jilin, Heilongjiang, East China has a larger scope covering Beijing, Tianjin, Hebei, Shanghai, Jiangsu, Zhejiang, Fujian, Shandong, Guangdong, and Hainan, Central China envelops Shanxi, Anhui, Jiangxi, Henan, Hubei, Hunan and West China comprises Inner Mongolia, Guangxi, Chongqing, Sichuan, Guizhou, Yunnan, Tibet, Shaanxi, Gansu, Qinghai, Ningxia, Xinjiang.
This is considered an updated edition of the steel industrial location and steel structure mapping based on the last release on July 26 2012 that focused more on capacity expansion and relocation to coastal regions, Mysteel understands.
Written by Victoria Zou, zyongjia@mysteel.com
Edited by Hongmei Li, li.hongmei@mysteel.com
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