China to cut 14 mn t/year of coking capacity by 2020-end
...
China's total coking capacity is anticipated to shrink by 13.9 million tonnes/year by the end of 2020.
Although a substantial volume of new coking capacity will be commissioned this year, an even larger volume of small-sized or inefficient capacity will be decommissioned at the same time, provided that all the targeted eliminations are carried out as scheduled.
About 46.9 mn t/y of new coking capacity will come on stream, while 60.8 mn t/y of old capacity will be withdrawn, throughout this full year. Over January-July, some 16.5 mn t/y of capacity was decommissioned, while simultaneously 12.3 mn t/y of new capacity was commissioned.
Table 1: China's new coking capacity versus capacity for elimination
| Capacity (mn t/y) | Jan'20-Jul'20 | Aug'20-Dec'20 | TOTAL |
| New | 12.3 | 34.6 | 46.9 |
| Old | 16.5 | 44.3 | 60.8 |
Almost all of the 60.8 mn t/y of coking capacity will be removed from plants located in just five provinces -- North China's Shanxi and Hebei; East China's Jiangsu and Shandong; and Central China's Henan provinces.
For instance, China's State Council had earlier issued a guidance to cap Hebei's total coking capacity at 80 mn t/y. Accordingly, Hebei's provincial government had announced that all coking ovens, with chamber height lower than 4.3 metres, must be completely taken out of service by the end of 2020.
Table 2: Coking capacity elimination by region
| Region | Capacity (mn t/y) |
| Shanxi | 17.7 |
| Hebei | 16.6 |
| Shandong | 7.7 |
| Jiangsu | 6.8 |
| Henan | 12.1 |
However, the task of permanently removing so much volume of coking capacity by year's end may be challenging, as most of the work relating to capacity elimination is scheduled for December, and it is unclear at this point whether provincial authorities will revise their targets.
As for the proposed new capacity, North China's Shanxi province will also be another key area hosting about 20.2 mn t/y of new coking capacity this year. As small-sized ovens are to be dismantled while large-sized facilities are built, the quality of Shanxi's metallurgical coke is expected to improve.
As of early August, China boasted 541 mn t/y of coking capacity, among which 347 mn t/y was held by independent coking plants and 194 mn t/y at steel mill-affiliated plants. The aggregate volume is slightly lower than the 545 mn t/y recorded at the end of last year.
~
Note: This news article is published under a data exchange agreement between CoalMint and Mysteel - a China-centric insight and global metal markets intelligence providing company.
By Aditya Sinha
