Major Chinese steelmaker Baowu Steel Group (Baowu Group), the world’s largest steel producer, with an annual crude steel capacity of over 100 million mt, plans to acquire state-owned Shandong Iron & Steel Group (Shangang), the seventh-biggest steel mill in China, located in Shandong Province in eastern China.
It will be the next acquisition among Chinese steel mills, as announced by Shandong Iron & Steel Co, Shangang’s Shanghai-listed subsidiary, on July 15. This would bring the total capacity of Baowu Group above its targeted 150 million mt, far above its global rival in terms of capacity, ArcelorMittal.
In 2020, Baowu Group produced 115 million mt of crude steel, while Shangang managed to produce 31 million mt in total in the same year.
The total capacity of Shangang is around 38 million mt per year.
The consolidation of China’s steel industry is aimed at supporting the efficiency of steel production and at reducing emissions. Baowu plans to reduce its emissions by 30 percent by 2035.