Coke productivity expands on 220 million ton market demand

Coke productivity expands on 220 million ton market demand

"It is expected that China total coke demand may reach 220 million tons in 2005, 77% of which will be consumed by steel industry." Hua Zugui, president of China Coking Coal Co. Ltd and Director of Northern Coke Union, noted in the 3rd Far East international steel conference recently. Facing the large demand, Shanxi Sanjia Meihua Co. Ltd decided to increase its annual production capacity to 3 million tons by 2008, doubling its current productivity. Chief Engineer of the company Shao Weiwen revealed this in an interview on April 19th. Shanxi Sanjia Meihua Co. Ltd is just one company among all to enhance production capacity. Related data shows that, five subsidiary mills of China Coking Coal Co. Ltd with annual productivity of 2.85 million tons, are expanding their production capacity actively, and the new productivity under construction may total 3.75 million tons. "Although the government has implemented macro-control on China steel industry," Hua Zugui pointed, "China is still experiencing a new-round rising stage, which is estimated to last until 2008". China Iron & Steel Association (CISA) estimated that China crude steel & pig iron production may top 300 million tons and 280 million tons respectively in 2005, symbolizing more than 20 million tons coke demand against that of 2004. He also said that China exported 15.01 million tons of coke last year mainly to Europe, Japan, Brazil, U.S. and India, and the export quota this year totals 14 million tons. It is known that quota system is applied to China coke export. China had decided to reduce coke export to 9 million tons in 2004, leading to surging price, which triggered dissatisfaction from EU,U.S, Italy and other areas. Therefore, China has agreed to increase coke export to 14 million tons in negotiation with EU. China Ministry of Commerce issued export quota for 2005 last December, which includes 14 million tons of coke and the 48 enterprises qualified for coke export were announced the same time. Actually, China has grown to become the top coke producer & exporter of the world, with coke production & export reaching half of global total. "Although coke export has only held 8% domestic production, it has already occupied more than 60% global market," Li Lianji, researcher of Shanxi Academy of Social Science told reporter, "coke has been the only product on which we have a say in export trade." Li Xinchuang, vice Pesident & Chief Engineer of China Metallurgy Industry Planning Research Institute (CMIPRI) stated that China can reduce coke export appropriately to stabilize production, which is also favorable for China to have more say in international market.