[SMM Analysis] Shandong Steel Enterprises face pressure to limit production in preparation for Qingdao SCO Summit

SMM News: the SCO Summit will be held in Qingdao from June 9 to 10, 2018. The Shanghai Cooperation Organization (SCO), the first comprehensive international organization led by China and named after Chinese cities, is the first comprehensive international organization to be led by China and named after Chinese cities. Holding the SCO summit is bound to greatly enhance the international and domestic influence of Qingdao and even Shandong. The organization of the conference and the maintenance of the city image need the cooperation of the whole province, but for the regional steel enterprises, cement and other chemical enterprises, it will be another difficult problem. As early as 16 years to promote the G20 summit in Hangzhou, Shandong region has been on the production control of iron and steel chemical enterprises, this year's SCO summit as the host, Shandong steel enterprises are once again facing pressure to halt production.

1. Help G20 Summit "West Lake Blue" Iron and Steel cement Enterprises in Jiushi City, Shandong Province or stop production and limit production

In September 2016, the G20 summit will be held in Hangzhou, Zhejiang Province. The reporter learned from the Shandong Provincial Environmental Protection Department that in order to ensure the air quality during the meeting, Shandong 9 cities will participate in the guarantee work to help "West Lake Blue."

Xiao Hong, director of the Atmospheric Department of the Shandong Provincial Environmental Protection Department, said that the air quality assurance work during the G20 summit was mainly in the Yangtze River Delta region, "but because air pollution has the characteristics of regional transmission, Shandong's nine prefectures and cities will also participate in air quality assurance as cooperating cities. " It is understood that the nine cities are Jinan, Qingdao, Zibo, Weifang, Jining, Rizhao, Laiwu, Linyi, Liaocheng. Xiao Hong said that during the G20 summit, if there is a change in regional meteorological conditions, there may be heavily polluted weather. As a cooperating city, the above nine cities will mainly control enterprises in the area of elevated sources (exhaust chimneys more than 45 meters above the ground), mainly for the steel and cement industries to take measures.

2. Shandong Environmental Protection Department: 1871 Iron and Steel, cement and Chemical Enterprises will limit production, stop production and shut down

In late April, the official website of "Shandong Province Enterprise Environmental Credit Evaluation" published the "2017 Enterprise Environmental Credit Assessment results", including the "2017 Red Standard Enterprise list" and the "2017 Yellow Standard Enterprise list". Among them, "red mark enterprise" has 1871, "yellow mark enterprise" has 30188.

In accordance with the measures for the Evaluation of Environmental Credit of Enterprises in Shandong Province, the environmental protection departments shall include them in the key objects of supervision for enterprises with environmental credit red marks, and shall order them to restrict production or stop production according to law if they are suitable for restricting production or stopping production. If it is applicable to the closure or closure, it shall be reported to the people's government with the power of approval in accordance with the law, and shall be ordered to close or close.

2. recent maintenance arrangements for Youshan Iron and Steel Enterprises in Shandong Province:

1. At present, the maintenance of a 450m3 blast furnace at Juneng Special Steel is expected to resume at the end of June. the blast furnace has a monthly output of 40, 000 tons of hot metal, and the steel plant plans to increase the proportion of scrap to the converter and electric furnace, affecting the bar output of about 10, 000 tons per month.

2. Foulon Steel plans to shut down the bar production line at the end of May, which is expected to take about 20 to 30 days. the specific start time remains to be determined, affecting the average daily output of about 2000 tons of bar.

3. Luli Steel Plant plans to shut down a 1080m3 blast furnace in May, the start time to be determined, maintenance time is one month, during which the normal production of the two rolling lines, affecting the average daily steel production of about 3000 tons.

SMM analysis:

According to SMM Iron and Steel, although the Qingdao Environmental Protection Agency officially refuted rumors as early as March that all steel enterprises in Shandong region had stopped production, as the meeting approached, the intensity of environmental inspection continued unabated. The selection of some steel mills in Shandong Province to carry out maintenance during the meeting reflects the environmental protection pressure faced by Shandong steel enterprises from the side. In addition, some provinces and cities bordering Shandong Province do not reduce the intensity of environmental protection supervision.

Xuzhou City, bordering southwestern Shandong Province, has tightened environmental protection again. according to SMM, the production of coke enterprises in Xuzhou area was limited to 50% or 70% in the early stage. this week, the government asked coke enterprises to stop all. at present, all steel mills in Xuzhou area are still in a state of complete shutdown and the time for resumption of production is unknown.

The Ministry of Ecology and Environment has recently evaluated the completion of the air quality improvement target of "2 ≤ 26" cities in Beijing, Tianjin, Hebei and its surrounding areas. Jincheng City, Shanxi Province, has only completed 37% of the task goals, and the completion rate ranks first among the "2 ≤ 26" cities. At the same time, the Ministry of Ecology and Environment in March 2018 inspection found that Jincheng Gaoping City, Zezhou County, Shandong Province Heze Yuncheng County, Kaifeng County, Henan Province, a large number of problems. The Ministry of Ecology and Environment sent a letter to the people's governments of Shanxi, Shandong and Henan provinces requesting that the implementation of quantitative accountability work be initiated.

In preparation for the SCO Summit, an international event, the government will certainly impose strict requirements on air quality around Qingdao. Or there will be requirements for peak production or even shutdown. Before the summit, iron and steel chemical enterprises should seize the time to adjust the production scheduling plan, as soon as possible to complete the transformation and upgrading of enterprises to promote energy conservation and emission reduction, in order to meet a series of policy requirements.