The Chinese government has said that China will cut crude steel production capacity by 100-150 million mt and reduce the size of its coal industry to ease the problems of excess capacity in the steel and coal industries.
China’s State Council, led by Premier Li Keqiang, announced the decisions at a meeting on January 22, according to a statement issued on the Chinese government's main web portal.
Firstly, the Chinese government will help enterprises to exit the steel industry through mergers, transformation and relocation, with the aim of cutting steel production capacity by 100-150 million mt. Secondly, the government will implement strict measures to restrict new capacities, including not granting approval for new coal projects. Thirdly, special funds will be prepared for enterprises to carry out structural adjustments.
According to data issued by the National Bureau of Statistics, China's crude steel output fell by 2.3 percent year on year to 803.8 million metric tons in 2015 - the first decline in more than three decades.