By Min Zhang and Emily Chow
BEIJING (Reuters) – China’s top steel producer, Hebei province, saw crude steel output plunge 10% in 2021, hurt by stringent environment controls aimed at curbing pollution and reducing carbon emissions.
The northern province of Hebei, which produces more than double the world’s second biggest steelmaker India, made 225 million tonnes of the metal last year, down 9.9% from a year earlier, data from the National Bureau of Statistics (NBS) showed on Thursday.
Still, it accounted for more than one-fifth of China’s total steel production, which stood at 1.03 billion tonnes last year, down 3% from a record high in 2020.
Graphic: China crude steel production- https://fingfx.thomsonreuters.com/gfx/ce/zgvomaxbqvd/012002.png
The falling output came amid Beijing’s requirement for lower annual production as authorities try to contain energy consumption in the ferrous sector that contributes around 15% of China’s total carbon emissions.
Along with Hebei, other major steel producing provinces also saw their production fall from a year earlier. The second and third producers, Jiangsu and Shandong, saw output drop 1.5% and 4.3% respectively last year, according to the NBS.
With China holding the Winter Olympics in February, the government has ordered steel mills surrounding Beijing to cut their output until mid-March in 2022.
Steel hub Tangshan city in Hebei has sounded several pollution alerts in recent months, with the industrial sector urged to curtail production accordingly.
However, for plants out of the smog-blanketed area – such as central Hubei province and some southern regions that welcomed relocated steel capacity in recent years – production increased in 2021.
The Guangxi autonomous region’s steel output jumped 6% to 36.6 million tonnes last year, increasing its national ranking to seventh from tenth, the statistics bureau data showed.
“Steel production (curbs) this year could be relaxed pending market condition,” analysts with CITIC Securities wrote in a note. “But overall output is still expected to drop amid government controls.”
Graphic: China’s regional steel production- https://fingfx.thomsonreuters.com/gfx/ce/znvnelabapl/01201.png
(Reporting by Min Zhang and Emily Chow; Editing by Mark Potter)
