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Chinese steelmakers not meeting government production targets

Posted on 07 September 2021

Steel production in China may be 88.01Mt for August 2021, up 1% from July 2021, according to a new report by TransitionZero, a climate analytics provider.

China’s crude steel production could be up 4-7% this year, claims the report, meaning that the country’s ability to meet its government-set target of limiting 2021 steel outputs to 2020 levels is unlikely with a top-down crackdown.

The findings show that the majority of China’s steel production derives from carbon intensive BF and BOF production routes. As such, this possible policy miss will have significant climate implications: the year-on-year growth in China’s steel production without a further crackdown would result in an additional 158Mt of CO2 - the equivalent of total emissions in the Netherlands.

The report claims that growth in China’s steel production is likely due to the country’s stimulus-filled, post-COVID construction boom, according to analysts from TransitionZero.

“China’s central authorities have made good progress in reducing production in Eastern provinces, but more needs to be done in Central and Western provinces to meet their production target. With additional action, China could reduce emissions and show climate leadership in the run up to COP26.”

Matt Gray, energy analyst at TransitionZero.

TransitionZero’s methodology uses a combination of satellite imagery and publicly available data to monitor steel production globally and make independent facility production estimates in near real-time. The methodology, which has also been used to measure China’s coal plant emissions, helps the power and heavy industries assess transition risks and opportunities as they look to decarbonise.

“While steel mills seem committed to respecting the production cuts imposed by the government policy, it remains to be seen whether all mills will do the same. If replicated by the Chinese government, our approach could be another powerful tool for regulating steel production and emissions.”

Badr Ben M’Barek, data scientist at TransitionZero.

TransitionZero’s methodology uses a combination of satellite imagery and publicly available data to monitor steel production globally and make independent facility production estimates in near real-time. The methodology, which has also been used to measure China’s coal plant emissions, helps the power and heavy industries assess transition risks and opportunities as they look to decarbonise.

To view the complete report, visit https://tinyurl.com/bcxpwd34

Source : Steel Times International