16 Years Manufacturing Experience

New version of the implementation measures for capacity replacement in the iron and steel industry will be introduced

The reporter of “Economic Information Daily” learned that the new version of “Implementation Measures for Capacity Replacement in the Iron and Steel Industry” has completed the stages of soliciting opinions and revisions, and is currently following the final process. This means that since my country’s steel production capacity replacement and project filing work has been suspended for one and a half years since the beginning of 2020, the steel production capacity replacement will start again.

An authoritative person said that some deep-seated contradictions in the steel industry have not yet been fundamentally resolved. Capacity replacement is an important means to achieve the organic combination of prohibition of new capacity and structural adjustment. It will help my country implement a new round of “de-capacity”, guide my country’s steel companies to optimize capacity deployment and adjust regional layout.

Wen Gang, deputy director of the Iron and Steel Division of the Raw Materials Department of the Ministry of Industry and Information Technology, said at the first Beibu Gulf Iron and Steel Development Forum in 2021 that although the current development situation of the steel industry is gratifying, it must also be noted that the steel industry has a serious dislocation of production capacity and output, and the foundation for capacity reduction is not solid. , The proportion of iron ore imports is too large, etc., and industrial security is at risk. At the same time, there are still deep-seated contradictions and problems such as gaps between enterprise development and high-quality development requirements, so we cannot be blindly optimistic.

The new policy for the replacement of steel production capacity aims to strictly observe the red line of not adding new production capacity. Wen Gang said that the replacement ratio of steel production capacity will be significantly stricter. The revised production capacity implementation measures will greatly increase the replacement ratio, expand sensitive areas, and further increase restrictions on the scope of reconstruction and expansion of specific areas. But at the same time, in order to encourage enterprises to substantively promote mergers and reorganizations, orderly development, electric furnace steelmaking, and exploring the development of low-carbon technology, the implementation measures appropriately lower the replacement ratio, reflecting differentiated support policies.

“Increasing the production capacity replacement ratio is to reduce the development of the background. The setting of the production capacity replacement ratio must ensure that after the project is implemented, production capacity can be effectively controlled, and there can be no nominal capacity reduction and actual output increase.” Insiders said.

The person concerned said that with the improvement of the supply-demand relationship in the steel industry, the price of steel has rebounded, and corporate profits have improved. In some places, blindly attracting investment and ignoring the conditions, the impulse to quickly launch steel smelting projects. The project management procedures stipulate that there is a misunderstanding of “getting on the train first and then buying the ticket”, leaving the steel industry still at risk of overcapacity to a certain extent.

For this reason, the implementation measures are clear, and it is strictly prohibited to increase the total steel production capacity in key areas for air pollution prevention and control. Provinces (autonomous regions, municipalities) that have not completed the total steel production capacity control target shall not accept the steel production capacity transferred from other regions. The Yangtze River Economic Belt region prohibits new or expanded steel smelting projects outside the compliance zone.

At the same time, Wen Gang pointed out that this year will actively cooperate with the Development and Reform Commission and other relevant departments to organize the “look back” inspections of steel reduction and reduction of crude steel output, and guide steel companies to abandon the extensive development method of winning by quantity, and effectively consolidate the effectiveness of reduction in capacity. .

Prior to this, the National Development and Reform Commission and the Ministry of Industry and Information Technology made arrangements for “looking back” on the reduction of steel capacity in 2021 and the reduction of crude steel output. The two ministries and commissions will focus on inspecting the shutdown and withdrawal of smelting equipment involved in resolving excess steel production capacity and cracking down on “local steel”. At the same time, overall consideration of carbon peaking, carbon neutrality and long-term target nodes, focusing on reducing the crude steel output of companies with poor environmental performance, high energy consumption, and relatively backward technological equipment levels, avoiding “one size fits all”, and ensuring that the country’s crude steel will be achieved in 2021. The output fell year-on-year.

Zhang Longqiang, president of the Metallurgical Industry Information Standards Research Institute, said that for localities, it is necessary to strictly implement capacity replacement measures, increase the proportion of long-process reduction replacements, strictly enforce regulations prohibiting new steel production capacity, and severely investigate and deal with violations of laws and regulations. At the same time, by scientifically optimizing the distribution of productive forces, the phenomenon of “North-South Transport of Steel” will be effectively changed. He suggested that in the Beijing-Tianjin-Hebei region, the long-process steel production capacity should be reduced; focus on the Beijing-Tianjin-Hebei and surrounding areas, the Yangtze River Delta, and other areas with concentrated long-term production capacity and key ecological environments, and rational layout and development of short-process steelmaking.

Luo Tiejun, vice chairman of the China Iron and Steel Association, pointed out that the continuous growth of my country’s steel production driven by demand has effectively supported the development of the national economy. However, in the long run, with the transformation of my country’s economic growth structure, the “abnormal” state of steel consumption last year and the current period is difficult to sustain.

Luo Tiejun suggested that the production limit must be kept under pressure, and no “one size fits all”. We should focus on limiting the output of illegal new additions and non-standard capacity replacement projects since 2016; limiting the output of poor environmental protection and non-standard enterprises; limiting the output of pig iron to limit the output of crude steel. For enterprises that reach the ultra-low emission A-level and electric furnace short-process steelmaking enterprises, there should be less or no restrictions, but he also said that the so-called unlimited is not full-load production, and the output of these enterprises should also not increase year-on-year.

Post time: May-10-2021