In order to consolidate the results of its efforts over the summer and further improve air quality, Tangshan City has issued September emissions reduction measures, which will directly affect coking and steel production volumes, Kallanish notes.

All 19 steelmakers other than Shougang Jingtang and Shougang Qiangang have to reduce iron and steel output by 30% from listed capacity. The previous plan in effect from 20 March to the end of 2021 included a 30% restriction only on iron production.

According to Tangshan’s 74.2 million tonnes of crude steel output in the seven months through July and its forecasted production volume of 131.7mt for this year, the city had been expected to produce 57.5mt over the remaining five months. Market sources suggest cutbacks are likely to deepen as a result of these policies, and mills are being asked to reduce actual production, rather than just limiting output relative to capacity.

As for the coking industry, the coke-out time for B-level enterprises is extended to 28 hours, and that for C-level and D-level enterprises is extended to 32 hours. Wet quenching is prohibited unless dry quenching equipment is being overhauled or if an accident knocks out dry quenching equipment.

In addition, heavy trucks are banned from leaving coking and steel plants between 02:00 and 09:00 local time. Coke, coal and iron ore are also prohibited from being shipped out of ports. This is expected to cause some supply disruptions but this will be offset by a decline in demand for resources.