On April 15, the government of China's northeastern province of Shanxi commenced its restructuring of the local steel industry, aiming at the establishment of five main steel manufacturing bases in the province, namely, at Taiyuan, Changzhi, Yuncheng, Linfeng and Lvliang.
Of all the steel bases, the Lvliang base subordinated to Taiyuan Iron and Steel Co. will be the main focus of the restructuring. By 2011, the number of steel manufacturers in the whole province will be reduced to about 50 from the current 200. Eventually the number of steelmakers in the province will be cut to just 10. Meanwhile, within the scope of the reorganization of the steel industry in the province, the annual production capacity of Taiyuan Steel is set to increase to over 20 million mt by 2011, and to over 30 million mt by 2015. Accordingly, Taiyuan Steel will account for 67 percent of the total production capacity of the whole province, from its current share of 25 percent.
In addition, the Shanxi provincial government is also to exert strict control with regard to overall production, refusing any further production expansion projects.
Currently, Shanxi has more than 200 steel manufacturers, with thirteen having capacities of 1 million mt and over, and five with capacities of 2 million mt and over. All the others are small-sized steelmakers, scattered across more than 60 counties in seven cities.