How Will China Actions Affect Zinc Market? SMM Reports

SHANGHAI, Feb. 17 (SMM) - China’s Ministry of Environmental Protection announced it will execute air quality inspections during February 15-March 15 in 18 cities, SMM learns. These cities include Beijing, Tianjin, Hebei’s Shijiazhuang, Langfang, Baoding, Tangshan, Handan, Xingtai, Cangzhou, Hengshui, Shanxi’s Taiyuan and Linfen, Shandong’s Jinan and Dezhou and Henan’s Zhengzhou, Hebi, Jiaozuo and Anyang, which are major metal producing regions.

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In these 18 cities, Tianjin, Hebei, Cangzhou and Hengshui have an agglomeration of galvanizers. Large steel tube/pipe plants reported slow sales due to weak demand and environmental protection factor, so they did not reach full operation, SMM said. 50% of galvanizers in Daqiu Village, Tianjin are still restricted as they have yet to complete coal-to-gas switch.

Plants in some regions were not affected yet as the inspections are not so strict during February 15-28. Any effect from environmental protection on galvanizers in Hengshui and Handan is only limited, with production steady. Zinc oxide producers in Hebei and Tianjin were not affected and returned to normal production after the 2017 Chinese New Year holiday. No plants in Jiangsu and Zhejiang reported production restrictions, SMM understands.

But operating rates at galvanizers and zinc oxide producers will be constrained in March as the execution of inspections step up, SMM added. 

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