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China does not tire of repeating about disabling excess capacity

7 June 2016

Representatives of Western countries are not tired to accuse China in the overproduction of steel. While there is a debate about toughening of measures concerning restrictions on imports of Chinese steel. In response, the Chinese government continues to talk about the gradual withdrawal of the steel market of excess capacity. In particular, the government of Hebei province announced the closure this year of the generation capacity steel and cast iron. It is expected to bring down 17.3 million tons of iron. The closure of steel capacity is expected to reach 14.22 million tons annually. Of them until November 2015 and will be closed by 8.22 million tons. Another 6 million tonnes will be shut down in recent months. In General, the representatives of the company Hebei Iron & Steel talk about the decline to 5 million tons per year. The reduction will be conducted in 2016−2017.

In Hebei province is about one fourth of all steel producers in China. The province has provided their own data. In 2013, the province housed the enterprise, the total annual capacity of which reached 283 million tons of steel. Already in 2014−2015 in the province closed 41.06 million tons of steel capacity. By the end of this decade, the government of Hebei plans to leave in operation only part of the companies. In General, they should not produce more than 200 million tons of steel. At the same time in 2015 in Hebei province was produced 187.9 million tons of steel.

Earlier, the government of Tianjin has also announced the closing of the facilities. In 2015, there were produced 26.1 million tons of steel. By 2020, it is assumed that the total volume of production will decrease by 9 million tons annually. Hebei Iron & Steel Group is planning to decrease to 5.02 million tons by the end of 2016. The company plans to reduce pig iron production by 2.6 million tons per year. As the representatives of the company, the reduction of capacities held since 2008. Steel production declined by 5.6 million tons. Pig iron output fell by 6.8 million tons. The decrease in 2008, the company reimbursed the launch of new lines. In 2015, the company issued 47.75 million tons of steel. However, she was ahead of the company Baosteel Group to almost 13 million tons. Baosteel Group is in the Chinese steel sector the second position.

By 2020, Hebei Iron & Steel plans to increase the share of steel products with high added value. Currently, it is 41%. The planned volume will reach about 70%.

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