[Ferro-Alloys.com]The new Environmental Law came into effect on Jan 1, 2015, which was called the most severe one in China's history.  The new law increased the penalties to the companies who broke the law by closing down the factories and administrative detention.  Local government and environmental department officials would be judged for the incidents which cause environmental disasters.

 

What influence have been made to steel and ferroalloys industry after the new environmental law came into effect? Most speakers mentioned the new Environmental Low at the 4th Ferrosilicon summit and 3rd FACOM Members Meeting on Jan 10, 2015 in Beijing. Through interview of some senior officials from large ferroalloys companies at the meeting,  Ferro-Alloys.com got to know that the new law had not made too much changes for the current situation, and whether the new environmental law would be thoroughly carried out is what the companies are concerned. 

 

Minor Influence to the Environmental Protective Companies and Vise Versa

 

According to the latest communication between Ferro-Alloys.com and ferroalloys companies, the new environmental law had minor influence on those companies, such as Erdos Xijin Kuangye, OM Materials (Qinzhou) and Fengzhen Fengyu, who have invested a lot capital in the environmental protection. The new law made those companies more competitive by elimination of the unqualified companies.

 

"We have invested millions of yuan in the environmental protection, which increased the production cost greatly, which made us less competitive compared with those who don't invest in the environmental protection, making an unfair competition," said a senior official,"Those companies without environmental protection investment might quit amid the complete implement of the new law, which would lead to a more healthy ferroalloys industry."

 

China's ferroalloys capacity totals more than 50 million tonnes, among which 20 million tonnes is under regulation. According to the new Environmental Law, part of the capacity might be washed out. 

 

A Healthy Market for Steel Industry would be Seen

 

There are seldom steel mills who can meet the requirement of the new Environmental Law, and to meet the new standard, an investment of 90-110 billion yuan is required for the entire steel industry. However, most steel mills are overwhelmed to invest in the environmental protection under the widespread deficit of the steel industry. The thorough implement of the new Environmental Law would have significantly negative influence on the steel industry, and a large number of steel mills might be weeded out, which is what the government wants to see.  Consequently, the overcapacity will be solved and fair market for steel mills would be seen.

 

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