Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

China’s leading steel-making provinces Hebei and Handan imposed orange pollution alerts forcing several steel mills to cut production as local authorities prepare for adverse weather condition in winter. Hebei province issued an orange smog alert effective Dec 13 and Handan province extended its orange alert amid severe air pollution. 


A total of 11 cities in the Hebei, including provincial capital Shijiazhuang and steel hub Tangshan city, will impose the orange alert under which steel mills have to reduce or suspend production until further notice. In the central, southern and eastern parts regions of Hebei province, accumulation of lung-damaging small particles PM2.5 have reached dangerous levels. 


The Handan province also extended its orange alert for air pollution that was originally scheduled from Dec 5-10. The adverse weather conditions and severe pollution are unlikely to disperse till Dec 16-17, according to Handan environmental bureau.


In China’s three-tier pollution warning system, orange alert is the second-highest level, with red as the highest and yellow as the lowest level. China’s environment ministry has warned that unfavourable weather could result in smog build-ups till February.



Steelmakers based in these regions are forced to cut emissions and reduce production which could impact domestic steel prices in China in the near term. Heavy-duty trucks with lower emission standard are also banned from the road. Many steel mills, who comply with China’s industrial emission standards, are exempt from the production cuts.


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