FOCUS: Lighter winter restrictions could weigh on China's steel prices

Domestic steel prices in China are expected to experience downward pressure over the next few months due to less stringent limits being implemented by the authorities in the country’s northern region where the bulk of the country’s steelmaking capacity is located.

Steelmakers in Hebei province’s Tangshan city, China’s steelmaking hub, will be allowed to maintain their production rates if they meet existing emissions standards, its municipal government said in the latter half of September. Mills that do not meet those emissions standards must cut their production by 30-70% over six months from October 1. In comparison, all mills in Tangshan were ordered to cut production by 30-50% during the last winter heating season between November 15 last year and March 31 this year. China’s Ministry of Ecology & Environment, at the end of last month, also issued its autumn-winter air pollution control plan for 28 cities - namely Beijing, Tianjin and 26 cities in the provinces of Hebei, Shandong, Shanxi and Henan. Beijing, Tianjin and the four provinces make up the heart of Chinese steelmaking capacity – they accounted for 44% (or 270.53 million tonnes) of the 617.4 million tonnes of crude steel produced...

Published

Jessica Zong

October 12, 2018

11:32 GMT

Shanghai