As reported by China-based Caixin Global, the municipal government of Tangshan, a major hub for steel production in China, has issued a draft steel production plan for the post-winter period which requires steelmakers in Tangshan, located in China's Hebei Province, to implement production cuts of 10 percent to 15 percent from March 16 to November 14. The municipal government aims to cut its crude steel output by 9.875 million mt in the given eight months. In 2017, China’s crude steel output amounted to 831.73 million mt, up 5.7 percent year on year, based on which the decision of the Tangshan government will reduce China’s annual crude steel supply by 1.8 percent if the Tangshan output reduction is translated into an annual figure, i.e., a reduction of 14.80 million mt of crude steel output per year.
Moreover, the decision of the Tangshan government will likely exert an impact on steel production in other parts of the country. In addition, further production cuts will be anticipated for the 2018-19 winter season.
On the other hand, there is also a draft production restriction plan for the city of Handan in Hebei Province for the period from April 1 to September 30, for those steelmakers who do not meet standards in terms of warehouse conditions, emissions of particulate matter and gas, and for those who do not complete transformation and upgrades of pollutant treatment facilities. These steelmakers will have to cut their steel production by 20 percent during the given period.