Chinese Government Seeks to Close Inefficient Manufacturing Facilities

China targets reduction in steel, paper, coal, coke, other materials.

April 9, 2010

During a recent press briefing, Hou Shiguo, deputy director for China’s Industry Department of Industrial Policy and Information, says that the ministry is developing a plan to remove excess capacity and outdated operations in a range of materials, including power, coal, iron and steel, cement, nonferrous metal, coke, paper, leather and printing material.

The goal of the project is to remove smaller operations, which would allow for improved allocation of resources to strengthen the existing facilities.

According to one report, by the end of this year, China expects to remove furnaces with capacities of less than 6,300 kilovolt-amperes from the ferrous-alloy industry and the carbide industry. In addition, by the end of next year, it will ban furnaces with capacities of less than 400 cubic meters from the steel industry and shut down blast furnaces with less than 30 tons of steel-making capacity.

The circular also sets forth the tasks of eliminating outdated facilities in the nonferrous metals industry, light industry, and the textile industry by the end of 2011, and removing outdated facilities from the building material industry by the end of 2012.

The circular stresses that joint efforts of all the departments concerned are needed to fulfill these tasks.