SHANGHAI, Nov 5 (SMM)—As many regions in northern China will enter the heating season of 2020-2021, and as 2020 is the last year of the three-year action plan to fight air pollution, SMM has recently surveyed and summarised relevant policies and specific measures in “2+26” cities. This article will focus on the effect of the upcoming heating season on China’s prebaked anode industry.
The general office of the Ministry of Ecology and Environment of China issued a technical guide at the end of June for key industries to reduce emission in heavily-polluted weather, in which it stipulated specific emission reduction measures for enterprises with different grades in key sectors.
At present, there are 49 prebaked anode producers in operation in Beijing-Tianjin-Hebei and its surrounding areas and the Fenwei Plain, with total equipment capacity of 11.72 million mt, accounting for about 41.8% of the total built capacity in China, and total operating capacity of about 9.3 million mt, 45.3% of total operating capacity. This environmental policy is expected to have a great impact on prebaked anode supply in the winter, though local policies have yet to be implemented. In the following part of this article, the author will elaborate on effects of the policy in different provinces.
Shandong province: As we can see from the table above, heating-season production restrictions will have a big impact on prebaked anode producers in Shandong, with 27 producers involved whose total capacity stands at 7.56 million mt. In theory, this would cause a production cut of about 1.44 million-2.02 million mt.
Henan province: According to the policy issued by Henan government, total capacity of prebaked anode makers with A or B grades stands at 1.37 million mt, with Henan Zhonfu, Luoyang Wanji and Luoyang Longquan Tiansong’s prebaked anode plants evaluated as grade B. The Henan government will strive to eliminate the 18 independent prebaked anode producers whose annual capacities stand below 100,000 mt before the end of 2020 by comprehensively using economic and legal means, SMM learned.
Other regions: This production restriction is expected to have limited impact on prebaked anode output in Hebei, as operating rates at local producers have been low as the region has long been under strict control of air pollution.
In summary, the environmental restrictions are expected to have a great impact on prebaked anode makers in Shandong and Henan. Producers in Shandong are now managing to operate at full capacity in order to make preparations for orders in the heating season. High costs of raw materials and production restrictions in the north led to a steep fall in prebaked anode supply.
