Seven government agencies made such a proposal

Seven Chinese government departments have put forward a proposal aimed at increasing the share of electric arc furnaces (EAFs) in steel production to over 20% by 2030. This is reported by SteelOrbis.

This step will contribute to the greening of the manufacturing industry, the formation of new industrial competitive advantages in the implementation of the country’s environmental goals, as well as accelerate the construction of a modernized industrial system and promote a new type of industrialization.

Among the agencies that made the proposal are the Ministry of Industry and Information Technology (MIIT), the National Development and Reform Commission (NDRC), the Ministry of Finance, and the Ministry of Ecology and Environmental Protection.

Last December, China’s State Council announced a plan to improve the country’s air quality in the long term as part of its efforts to promote quality economic development. According to the plan, the authorities will continue to promote the development of electric steelmaking, which will account for 15% of total steel production by 2025.

Morgan Stanley analysts believe that China’s goal of reaching a 15% share of EAF steel production by 2025 looks somewhat optimistic, as the country is experiencing a reverse in scrap usage. Since 2017, the country has invested 110 million tons per year in new EAF capacity as part of a replacement program, but the average utilization rate is 60%.

As GMK Center reported earlier, China’s steelmakers produced 1.019 billion tons of steel in 2023, up 0.6% year-on-year. This means that the downward trend in the country’s steel industry has stopped after two consecutive years of production decline.