On June 24, Chinese steelmakers Zhongyang Iron & Steel Co., Ltd and Wenshui Haiwei Iron & Steel Co., Ltd, both based in Lüliang city in the province of Shanxi, signed an agreement to merge and form a new steel company to be called Lüliang Steel Group.
Zhongyang Iron & Steel at present has an annual output capacity of 5 million mt of coal, 1.2 million mt of iron ore concentrate, 1.5 million mt of coke, 3.6 million mt of pig iron, 3.6 million mt of crude steel, and 3.6 million mt of finished steel. Wenshui Haiwei Iron & Steel has an annual output capacity of 1.6 million mt of pig iron, 1.4 million mt of crude steel and 0.4 million mt of strip steel. These two mills are the biggest steelmakers in Lüliang city. The merged company Lüliang Steel Group is to consolidate all steel production capacity in Lüliang city, including Chengcai Iron&Steel Co., Ltd, before the start of 2011, forming a steel production base with a total output capacity of 10 million mt.