What’s new: China’s crude steel output fell 4.1% in August to 83.24 million tons from a month ago as a national campaign to curb production and reduce carbon emissions begins to take effect.
The August production figure, which is the lowest since June, also represents a 13.2% drop from the same period last year, according to the latest data (link in Chinese) released by the National Bureau of Statistics (NBS) on Wednesday.
The background: Since 2020, China has stepped up efforts to rein in its steel industry, which is the world’s largest and accounts for about 15% of the country’s carbon emissions, in pursuit of the goal of bringing emissions to a peak by 2030 and achieving carbon neutrality by 2060.
The government has pledged to keep this year’s crude steel output below the level of 2020, when it topped 1 billion tons. Since June, several major steel producing provinces including Hebei, Jiangsu, and Shandong have released annual targets for production cuts.
So far, that remains an arduous goal. In the first eight months of this year, China’s major mills had already produced 733 million tons of crude steel, a 5.3% increase from the same period in 2020, according to NBS data.
In order to achieve the cap, total output for the next four months must be reduced by 18.6% over the same period a year earlier, meaning production needs to be kept within 80 million tons per month.
Read more In Depth: China’s Carbon-Reduction Plans Turn Up the Heat on Steel Capital
Contact reporter Kelsey Cheng (kelseycheng@caixin.com) and editor Flynn Murphy (flynnmurphy@caixin.com)
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