An expert involved in the current drafting of a steel development policy said that regulations on production capacity, industrial mix, industrial distribution, energy consumption and pollution in the next decade is expected to come out next month, according to a media report on Tuesday.

Li Xinchuang, now vice-president of the China Metallurgical Industry Planning & Research Institute, has been one of policy drafters since 2002 and was talking to Shanghai Securities Journal.

A State Council executive meeting approved the policy in principle on April 20, and in the past two months some restrictive measures on steel exports have already been adopted.

These included the removal of a 13 percent tax rebate for steel billet and ingot exports in April, and prohibited iron and steel processing trade as of May 19.

Wu Wenzhang, general manager of an industry web portal, told the journal that the new policy would regard steel as a pillar industry and a symbol of national economic strength and social development.

Nevertheless, the article said the government would keep steel production capacity below 300 million tons, and that the industry should prioritize domestic demand.

Measures expected are to: improve entry thresholds, eliminate outdated equipment, and strengthen approval of investment items and technologies to reduce steel usage; bolster large steel congregates and further improve industrial concentration; develop a 'circular economy' and boost sustainable development.

Wu described the industry's five main development goals as:

The proportion of quality steel products should be improved substantially, and a majority of steel products basically meet the needs of domestic sectors, by 2010;

The production of the country's top ten steel makers should account for over 50 percent of the total in 2010 and 70 percent in 2020;

An industrial structure harmonious with resource and energy supply, transportation, market demand and supply, and the environment though adjustment of steel distribution by 2010;

Use of energy and water should fall from 2005's 0.76 tons of coal equivalent and 12 tons of water to 0.73 and 8 tons respectively in 2010, and 0.7 and 6 tons in 2020; and

All pollutant emissions should comply with national and local standards by 2006.

China is the largest steel producer in the world, with production of 270 million tons last year.

(China.org.cn by Tang Fuchun June 9, 2005)