China Unveils Plan for Ultra Low Emission Upgrade of Steel Sector
Chinese government has set out a five year development plan to promote green transformation for the steel sector. According to the plan “China aims to complete ultra low emission upgrade for 530 million tonnes of steel capacity. Around 620 million tonnes of crude steel capacity had already been upgraded to ultra low emissions or were in the process of being upgraded by the end of 2020.”
China has been working quietly on carbon emission cuts for a few years but its open pledge in 2020 to peak the country’s carbon emission by 2030 and to achieve carbon neutrality by 2060 has undoubtedly imposed more pressure publicly on the steel industry, the country’s second largest carbon emission source only after the thermal coal power generation. Over 2016-2020, China chopped off 150 million tonnes per year of steelmaking capacity, 140 million tonnes per year of induction furnace steel capacity. The ultra low emission standards for the steel industry, finalized in April 2019, have dramatically lowered the cap on the emissions of particulate matters, sulfur dioxide, and nitrogen oxide, from the whole steelmaking process, which is not primarily targeting carbon, but it is prompting the Chinese steel producers to go for greener steelmaking.
For 2021, China will continue to push forward supply-side reform and mergers and acquisitions in the steel sector
Chinese government also plans to strengthen management and control of its strategic mineral resources. According to the plan, which serves as a blueprint for economic and social development between 2021 and 2025, China, which relies heavily on overseas markets for some raw materials import such as iron ore, manganese and chrome, has pledged to improve its reserve security capabilities and conduct a new round of ore prospecting in the next five years.