China closes some northeast cement plants for the winter

China, the world’s largest cement producer, has ordered some cement plants in the northern provinces to shut for four months starting December 1 to reduce over-capacity and curb air pollution during the winter months, state news agency Xinhua reported.

The move, which will affect 103 production lines in the three provinces of Heilongjiang, Liaoning and Jilin, is set to hit coal consumption and limit a rebound in domestic prices.

The order was jointly issued by the China Cement Association and the three provincial governments, Xinhua reported late on Sunday. Persistent over-capacity has dogged the sector for years, with northern China using only about half of its total production capacity.

The northern provinces, including Hebei, are a major source of industrial pollutants blamed for a toxic smog that often spreads to neighbouring regions like Beijing, prompting Premier Li Keqiang to declare a “war on pollution”.

Kong Xiangzhong, vice president of the China Cement Association, was quoted as saying the winter stoppage would greatly curb air pollution, as fuel consumption increases markedly when temperatures drop.

Total cement output in northern China, including Inner Mongolia, hovers around 120 million tonnes in the winter months and requires about 20 million tonnes of coal. Fuel consumption falls to just 16 million tonnes in summer, Kong said.

The production halt follows an earlier order issued by the Xinjiang autonomous region to stop all cement production during winter, starting from November 1 to March 1, 2015.

The suspension in Xinjiang is expected to reduce coal consumption by about 1 million tonnes and help lift plant utilisation rates to 75 percent, from the current 60 percent, according to local media reports.

Coal is used to power kilns during cement production. It takes about 200 kilograms (440 pounds) of coal to produce one tonne of cement, according to the World Coal Association.

Despite efforts to cut output, China’s cement production rose 9.6 percent to 2.41 billion tonnes in 2013 from a year earlier, while total capacity has surged to more than 3.2 billion tonnes, according to data from the cement association.

Source

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