According to Economic Observer Network, on May 9th, Li Zhongjuan, Deputy Inspector of the Industry Coordination Department of the National Development and Reform Commission, revealed in Beijing that the "Plan for the Layout and Adjustment of Production Capacity in the Steel Industry" has recently been issued by the State Council. After the joint signing among various ministries, major projects related to production capacity layout and adjustment will be specifically implemented.

The "Plan for the Layout and Adjustment of Productivity in the Iron and Steel Industry" is one of the 18 key plans under the national "Twelfth Five Year Plan". The National Development and Reform Commission hopes to achieve industrial structure adjustment and optimization through layout adjustment, while solving the "Three Nos Syndrome" of imbalance, disharmony, and unsustainability in China's steel industry.

For a long time, the overall layout of China's steel industry has shown the characteristics of "heavy in the north and light in the south", with rapid economic development along the southeast coast and steel productiondemandLarge quantity, long-termsupplyInsufficient, and the steel production capacity in the Bohai Rim region is nearly 400 million tons, with over 50% of products exported. The layout of the steel industry in some areas does not comply with the national main functional zone planning andmanufacturingRequirements for transfer. Large steel enterprises have been established in 16 municipalities directly under the central government and provincial capital cities, which are increasingly unable to meet the overall development requirements of the cities.

According to the "12th Five Year Plan for the Development of the Steel Industry" released by the Ministry of Industry and Information Technology in November 2011, it is understood that new steel bases will no longer be established in the Bohai Rim and Yangtze River Delta regions in principle. Hebei, Shandong, Jiangsu, Liaoning, Shanxi and other regions with large steel scales have adjusted their industrial layout through mergers and acquisitions, elimination of backwardness, and reduction of production. Central provinces such as Hunan, Hubei, Henan, Anhui, and Jiangxi actively promote structural adjustment and industrial upgrading without increasing the total steel production capacity. Some markets in the western region are relatively independent areas, based on resource advantages, undertaking industrial transfer, and combining regional differentiation policies to moderately develop the steel industry.

In response to the current situation of large steel enterprises in 16 municipalities directly under the central government and provincial capital cities, the "Plan" also proposes to orderly promote the transformation or relocation of steel mills that are not coordinated with urban development. During the 12th Five Year Plan period, based on the maturity of conditions, support will be provided for the relocation, renovation, or transformation of steel mills in cities such as Guangzhou, Qingdao, Kunming, Hefei, Tangshan (Fengnan), Hangzhou, and Wuhu, and scientifically demonstrate the development positioning of steel mills in cities such as Xining, Fushun, Shijiazhuang, and Guiyang.

Wu Xichun, former Deputy Minister of Metallurgy and Advisor to the China Iron and Steel Industry Association, once pointed out that the major steel industry bases in South Korea and Japan are located in coastal areas. From a global perspective, the development trend of the steel industry is coastal and centralized, as coastal developmentcostLow consumption, environmentally friendly, and energy-efficient

According to the National Development and Reform Commission's survey, there are 20 steel mills located in provincial capitals and municipalities directly under the central government in China, and a total of 39 urban steel mills. In 2009, the total production capacity of 39 urban steel mills was 228 million tons, accounting for 39.5% of the total. After the release of the "Steel Industry Productivity Layout and Adjustment Plan", some urban steel mills will relocate according to specific conditions and standards.