The Zhejiang Provincial Development and Reform Commission and the Provincial Economic and Information Commission jointly issued the “Zhejiang Iron and Steel Industry Resolving Overcapacity Work Program†and “Zhejiang Iron and Steel Industry Cleanup and Rectification Criteria†recently to initiate the work of overcapacity elimination in the steel industry. The plan proposes that through five years of hard work, Zhejiang will compress more than 3 million tons of steel production capacity, increase the utilization rate of the production capacity to more than 80%, and reduce the number of steel-making enterprises by more than half, or about 20 companies.
It is understood that at present, the steel industry in Zhejiang has a certain foundation, and the scale of stainless steel ranks first in the country, and an industrial system dominated by calendering has been formed. Under the background of the current serious overcapacity of steel production in China, the steel industry in Zhejiang is under great pressure and the industry transformation and upgrading have started again.
According to the plan, Zhejiang will promote the relocation of Hangzhou Steel's steel mills, advance the adjustment of the steel industry structure in Wenzhou and Lishui, enhance the steel industry structure, guide the distribution to the coast and ports, and promote Wenzhou, Huzhou, Jiaxing, Lishui, Quzhou and other places. A number of steel industry bases with advanced technology, distinctive features, and dislocation competitions were established; a long-term mechanism for overcapacity in the iron and steel industry was initially established, and the industry’s competitiveness was significantly enhanced.
The specific work measures are concentrated on six aspects: strict control of new steel production capacity projects, comprehensive clean-up of illegal construction projects in the steel industry, rectification of the steel industry's built-in illegal production capacity, active promotion of adjustment of the steel industry's layout, and promotion of iron and steel enterprises' ability to innovate and develop; and Support enterprises to carry out structural adjustment such as mergers and acquisitions, technological transformation, and elimination of backwardness.
For example, in promoting steel companies' ability to enhance innovation and development, Zhejiang will promote the use of 400 MPa and above strength high-strength steel bars as a breakthrough to promote the upgrading of construction steel products. Targeting the upgrading of steel products used in downstream industries such as machinery, automobiles, shipbuilding, high-speed railways, home appliances, and electric power, we encourage enterprises to vigorously develop high-end steel products and develop green, low-carbon, energy-saving, environment-friendly steel and high-performance special steel materials.
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