Chinas top steel province to cut capacity to make way for new one

China, the worlds biggest steel producer, has been shutting outdated steel plants but also keeping any expansion under control to help tackle a years-long glut.

Authorities closed more than 600 steel mills producing low-grade construction steel during the first half of the year, cutting capacity by about 120 million tonnes, the state-owned China Economic Daily reported earlier on Tuesday. 

Last month, China said it has reduced its total steel production capacity by 42.4 million tonnes as of end-May, meeting 85 percent of its full-year target. 

In Hebei, the combined reduction in steelmaking capacity at nine mills of more than 11 million tonnes was meant to make way for the expansion of a plant by Shougang Jintang Iron and Steel Co, according to a document published on the Hebei governments website this week.

The expansion at Shougang Jintang Steels plant will add new capacity of 5.1 million tonnes, it said. The entire plant, when finished, can produce 9 million tonnes of steel products annually.