Handan City in northern China, the second largest steelmaking center in Hebei province after Tangshan, is tightening production controls at local industries, including steel mills, from September to October to improve air quality, a government document said. widespread in the Chinese steel market on September 2.
The new control measures cover the manufacturing and mining sectors, which are considered to be the main sources of pollution, such as steel production, coke production, limestone mining and zinc oxide smelting.
In terms of the steel industry, the Handan mills are expected to see an additional 4.4 percentage point contraction in manufacturing operations this month and next, while the 16 local steelmakers’ blast capacity will be capped at 53% -83%. , with variations based on the environmental performance of each steel mill.
In addition, Handan is to phase out 20 blast furnaces with a capacity of less than 1,000 cubic meters and 20 converters with a capacity of less than 100 tons in stages, as required in the document. More than 50% of the units should be shut down during this month, 70% should be shut down before the winter heating season in China (mainly starting in November), and they should all be shut down by the end of this year.
Prior to the introduction of these new controls, Handan steelmakers were required to comply with production limits of 20-30%, as confirmed by a local steelmaker. “We are all not working at full capacity (so) new orders mean we need to cut production,” he said.
While most local sources agreed that the additional restrictions for the September-October period would not greatly affect the current operations of the steel mills, they believed that the shutdown of small blast furnaces could lead to a significant reduction in steel production in Handan.
“There are several small blast furnaces in operation in Handan, although some of them have to be replaced with new ones, there will be a supply interruption after the old facilities are shut down and until the new facilities start working normally,” is another source. in Handan commented.
Like Tangshan, the cut in Handan steel production is seen as helping to meet China’s target of limiting crude steel production this year to 2020 levels. In January-July, Hebei Province produced a total of 139.4 million tonnes of crude steel, down 3.9% from last year, making it one of two provinces in the country to see a decline over the same period compared to with the same period last year. However, Hebei remains the largest steel province in the country, according to China’s National Bureau of Statistics.