Tightening Crackdowns Threaten To Tighten Iron Ore Supply In China

SHANGHAI, Jun 7 (SMM) – Recently, an iron ore backfill project in Malanyu Town, Zunhua city, Hebei province was tipped off to the local authority. In 2016, Zunhua city carried out backfill for 206 sand pits in the city, and the government of Malanyu Town handed over this project to Riqiang Iron Ore Dressing Plant. However, instead of backfill, Riqiang Iron Ore Dressing Plant dug the pit even bigger and occupied the cultivated land of several nearby villages. Three or four hundred trucks of ore were transported to Riqiang Iron Ore Dressing Plant for processing every day. Riqiang Iron Ore Dressing Plant dug ore and sand and then transported them to its dressing plant for being processed into sand, gravel and iron for sale.

According to the provisions of China's Land Management Law, in order to convert arable land into mining land, the procedures for changing construction land must be completed first. However, Riqiang Iron Ore Dressing Plant neither underwent this procedure nor obtained mining license.

Riqiang Iron Ore Dressing Plant has halted production. At present, all mines in Zunhua are waiting for approval to resume production, except for one state-owned mine, who is in normal production. They might be able to resume production by the end of June, according to original plans. However, after this scandal, the production resumption will probably be delayed. Some local independent dressing plants are also closed for checks after this incident while some are short of ROM.

Recently, news has spread that Hebei, Inner Mongolia, Henan and many other regions have taken action to resolutely crack down on unlicensed mining, cross-border mining, and illegal mining. In Pingshan County, Hebei Province, anyone who destroys 10 acres of cultivated land, more than 5 acres of basic farmland, or illegally exploits mineral resources worth more than 100,000 yuan will be punished according to law.

Despite crackdowns on illegal mining in some areas, the impact may be somehow counteracted by resumptions of legal mines in Shanxi and Hebei.

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