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The Inner Mongolia Autonomous Region Development and Reform Commission, the Ministry of Industry and Information Technology and the Energy Bureau have issued a notice on “Various protective measures to ensure the fulfillment of the goals and tasks of dual control of energy consumption during the 14th Five-Year Plan Period.”

China: Inner Mongolia shuts down blast furnaces, converters and coking plants
China: Inner Mongolia shuts down blast furnaces, converters and coking plants

Many steel making blast furnaces and converters to be shut down before end of 2023

As far as is known, the plan stipulates that pig iron blast furnaces for steelmaking with an effective volume of less than 1,200 m³, converters for steelmaking with a nominal capacity of less than 100 mt and electric arc furnaces with a nominal capacity of less than 100 mt (50 mt for alloy steel) will in principle be shut down before the end of 2023.

New construction of blast furnaces possible according to specifications

Those that meet the requirements can be replaced with new capacity based on the national standard. According to market sources, Inner Mongolia had a total blast furnace capacity of about 30 million mt at the end of 2020, including 12 blast furnaces with a capacity of less than 1,200 m³, which had a capacity of 9.3 million mt. Converter capacity totaled 36 million mt, including 10 million mt of converter capacity of less than 100 mt. Capacity replacements have already been made at these small blast furnaces and converters.

Coke plants will already be shut down by the end of 2022

Top-loading coke ovens with a coke chamber height of less than 6 m, stamp coke ovens with a coke chamber height of less than 5.5 m and coke plant projects with an annual capacity of less than 1 million mt will in principle be shut down before the end of 2022. Those that meet the requirements may receive capacity replacement based on the national standard. Coking capacity in Inner Mongolia totals 52 million mt, of which 12.43 million mt is non-compliant.

China gets serious with green announcements

Having already restricted the output of old and environmentally harmful steel making facilities in Tangshan by up to 50% for one year (Source), it is now hitting Inner Mongolia.

Trend already apparent since late 2020, early 2021

What was already apparent, and was not yet taken seriously by the Western market, is now becoming reality. After the small plants in Mongolia were already shut down by the state at the beginning of 2021 (Source) and ferrochrome prices exploded (Source), it is now also the turn of the small old mills for steel production.

The current 14th 5-year plan of the People’s Republic of China contains a clear commitment that the Chinese state must become cleaner and more environmentally friendly. The implementation of this has apparently begun. And they are very ambitious about it.

TISCO the new star in the steel Chinese sky?

Fear of TISCO? 18 million tons of stainless steel output in planning
Fear of TISCO? 18 million tons of stainless steel output in planning

In mid-March, it was announced that Taiyuan Iron & Steel (Group) Co Ltd, better known as TISCO, would become the world’s largest stainless steel producer, overtaking the privately owned Tshingshan Holding Group. In the future, TISCO is to produce up to 18 million tons of stainless steel per year.

Together with the state-owned parent company Baowu Steel Group, the megacorporations would have a total annual output of over 115 million tons of steel.

Consolidation measures by the Chinese government among steel producers

For more details, see our article: Fear of TISCO? 18 million tons of stainless steel output in planning

There we also discuss the fact that it is foreseeable that old steel mills will be systematically shut down by the Chinese government in the future. In order to make room for new, modern and above all clean steel mills.


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