CISA proposes to change production restrictions at steel mills

In response to Beijing’s plan to limit crude steel production this year to last year’s levels, the China Iron and Steel Association (CISA) recommends that production cuts should not be applied indiscriminately to all steel producers, but should instead target producers steel that is less environmentally friendly.

“In recent years, steel production in China has been driven by (and) growing demand,” CISA said in a statement. However, he cautioned that it is difficult to imagine that “the (sustainable) consumption of steel last year and currently observed will last for a long time. The central government’s announced target at the beginning of the year to curb crude steel production reflects the country’s policy towards the steel sector. ”

CISA states that production at all steel mills should not be reduced and proposes exemptions for steel mills that meet ultra-low emission standards and for steel mills operating with electric arc furnaces. But that doesn’t mean they are free to produce steel, as they should also avoid an annualized increase in steel production, he warns.

According to the CISA, businesses operating illegal steel facilities and those steel projects that contravene the laws should be banned, while those steel businesses that do not meet ultra-low emission standards are businesses that struggle to control emissions. – should also cut production. The decline in steel production should be realized by reducing the production of pig iron, he added.

In a situation where demand for steel is steadily growing, but production is declining, to ensure a stable supply of steel, a decrease in exports and an increase in imports, especially imports of raw materials such as billets, can be predicted, according to CISA. The focus of the Chinese steel market should be on meeting domestic demand, and imports can fill the supply gap if needed.

The requested cut in steel production is also a response to Beijing’s goal of reaching a “peak in carbon emissions” by 2030, and the steel sector has other ways to help meet its carbon emissions target as well, CISA notes. First, there is a reduction in steel production, as the options for reducing carbon emissions from the steelmaking process are limited.

Another way to reduce carbon emissions is to improve metallurgical technology. This challenge will require a collaborative effort from government, steelmakers and the industry as a whole, CISA said. The real way to cut carbon emissions is to promote the use of electric ovens. The association notes that the carbon dioxide emissions from the production of one ton of steel using the EAF technology are about 1.6 tons lower than the emissions from the blast furnace.

CISA also stated that high-strength, good quality steel products should be further disseminated along the production chain as another green development initiative.

The association’s announcement on Sunday follows the publication on April 1 of a joint announcement by China’s Ministry of Industry and Information Technology and the National Development and Reform Commission, announcing that both sides intend to revise the results of steel cuts from 2016.

… Tasks on the agenda of the two organizations include re-verifying the abandonment of facilities that were used to produce substandard steel, confirming the situation with construction and commissioning steel projects, and restoring steel production for 2021, Mysteel Global notes. release.

The re-examination will consist of three components. Local authorities in provinces and cities should first organize inspection teams and inspect local steel plants under their jurisdiction. Thereafter, the inspectors appointed by the central government will conduct an on-site inspection, and finally, the inspection report will be delivered to the relevant departments.

China’s crude steel production has grown in each of the past five years, up another 7% last year from last year to 1.065 billion tonnes, according to data from China’s National Bureau of Statistics.

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