Posted on 21 Jun 2024
China's blast-furnace steelmakers may need to reduce crude steel output by 21.42 to 23.47 million tonnes in total by the end of 2025 to comply with the country's action plan of energy conservation and carbon reduction for the steel sector during 2024-2025, Mysteel estimates.
In line with China's goals of achieving carbon peaking by 2030 and carbon neutrality by 2060, the action plan recently released by the State Council, the country's top administrative body, mandates the steel industry to save energy equivalent to 20 million tonnes of standard coal and to cut carbon dioxide emissions by approximately 53 million tonnes over the 2024-2025 period, as Mysteel Global reported.
The plan also stipulates that energy consumption per unit product via the blast furnace-basic oxygen furnace (BF-BOF) route must be reduced by more than 1% by 2025 compared with the 2023 level.
To achieve these targets, the Chinese steel industry must implement energy-saving and carbon-reduction transformations and energy-using equipment upgrades, the action plan notes.
Moreover, China's Ministry of Industry and Information Technology (MIIT) has also set energy consumption standards for the steel sector, stating that comprehensive steel energy consumption for the regular BF ironmaking process must not exceed 400 kg of standard coal equivalents per tonne and that for the regular BOF steelmaking process must not exceed 180 kg of standard coal equivalents per tonne.
Meanwhile, for high-efficiency BF ironmaking and BOF steelmaking production, comprehensive steel energy consumption must not exceed 370 kg and 160 kg of standard coal equivalents per tonne respectively, according to MIIT.
Mysteel's calculations based on the abovementioned standards indicate that to reduce steel energy consumption per unit product via the BF-BOF route by more than 1% by end-2025 from the 2023 level, Chinese steel producers will need to scale back their steel output ranging from 21.42 to 23.47 million tonnes in total by end-2025.
Mysteel's estimated crude steel output cut by region by end-2025 (mln t)
Region | High-efficiency BF-BOF production | Regular BF-BOF production |
Northeast China | 1.94 | 2.13 |
North China | 8.06 | 8.83 |
East China | 6.37 | 6.97 |
South China | 1.35 | 1.48 |
Central China | 1.69 | 1.86 |
Northwest China | 0.93 | 1.02 |
Southwest China | 1.08 | 1.19 |
Total | 21.42 | 23.47 |
Sources: NBS, Mysteel
Source:Mysteel Global
