China’s steel fundamentals in flux on decarbonization drive: 2022 preview

China’s steel production and end-user demand are likely to experience some dampening in 2022 amid the country’s stringent decarbonization policies, market participants told Fastmarkets.

New regulations, carbon emissions trading
China will implement a set of energy-consumption standards for iron and steelmaking from January 1, 2022 to align them with the country’s decarbonization guidelines, according to a notice released by the National Development & Reform Commission on November 15.
China is also using carbon trading as a tool to regulate and reduce emissions.
Some local governments have issued decarbonization targets for their steel industry.
For instance, Shandong province, China’s third-largest steelmaking hub, in November published a set of limits for the steel industry in its 14th five-year plan (2021-2025) to protect the environment.
“China’s crude steel production might be around 1 billion tonnes in 2022,” Li Xinchuang, chairman and chief engineer of the China Metallurgical Industry Planning and Research Institute (MPI) said at the 10th China Steel Technology & Economy Forum on December 3.

If November and December’s production rates were the...

Published

Jessica Zong

Zihuan Pan

December 29, 2021

09:40 GMT

Shanghai