China's provinces have released capacity closure targets that exceed the national target for the next 3-5 years. Progress by provinces so far is mixed however, Kallanish notes.

In 2015 China’s crude steel capacity reached around 1.2 billion tonnes/year and central government has said it plans to eliminate 100-150 million t/y in the coming 3-5 years. Local governments have also released their own plans for the next five years. Hebei intends to cut 100m t/y of crude steel capacity, Jiangsu and Shandong plan to cut over 15m t/y each, Chongqing and Tianjin will cut 8-9m t/y each, and most other provinces will cut around 3-5m t/y each. The total of local plans is much bigger than the goal announced by the State Council.

The National Development and Reform Commission (NDRC) commented in a recent conference call that only 47% of the national steelmaking capacity closure target had been achieved by the end of July. Performance has varied significantly from region to region. Four provinces, including Zhejiang, have already fulfilled their annual tasks ahead of schedule. Eight provinces including Hebei and Liaoning have achieved 10-35% of targets. Over 10 provinces have still not made any headway with their elimination plans for the year.

NDRC chairman Xu Shaoshi says every steelmaker, each production line and iron ore mine should contribute to resolving overcapacity, and separate goals and tasks should be allocated before late August. China has already barred the registration of new capacity in the steel industry and no new coal mine project will be approved within 3 years. The policy of reducing overcapacity will still take many years to resolve however.