With steel waste in crosshairs, China extends pollution war

China’s war on pollution is extending to a new front: the solid waste that makes up thousands of slag heaps around the country, a byproduct of its record steel output.

Hundreds of steel mills have been shut over the last few years for failing to comply with tougher environmental rules, with others forced to install better equipment to curb emissions and use higher-quality raw materials such as iron ore and coking coal.

But now industrial debris like slag is increasingly coming under the spotlight as well, potentially pressing steelmakers to tackle the pilings problems head on at a time when they are grappling with weaker profit margins.

The world’s top crude steel producer, which last year made a record 831.7 million tons of the material, churns out over 100 million tons of steel slag annually. However, the industry recycles less than one-third of that waste into products such as cement or concrete, leaving the rest stacked in heaps. That compares to slag utilization rates of around 98 percent in Japan and 87 percent in Europe, the University of Science and Technology Beijing said in a recent study.

Underscoring the government’s ramped up drive against steel waste, it this year began imposing a blanket 25 yuan ($3.64) levy for every ton of solid waste generated by industrial companies. That would mean 12.5 million yuan ($1.82 million) for a mill that produces 500,000 tons of slag a year.

Last month, the environment ministry accused mid-sized steelmaker Gaoyi Iron and Steel Co of illegally dumping large amounts of steel slag over a decade. The ministry said it would urge local governments to deal with solid waste issues, undertaking a special campaign to crack down on violations.

Some producers have already taken steps to fight the problem. Major steelmaker Anshan Iron and Steel Group (Ansteel) has invested around 1 billion yuan on eight slag processing lines with a total capacity of 11 million tons, Zhang Hewu, general manager at company unit Ansteel Green Resources Technology Co, told Reuters.

He said those facilities turn most waste into products such as cement and road construction materials, leaving only about 10 percent to be stored.

The recycled products are mainly sold in China, with some going to Singapore, Qatar, South Korea and the US.

Unlike Ansteel, many Chinese mills don’t have slag recycling plants, which global firm Harsco Metals & Minerals says is boosting its business processing and recycling slag.

There is a lack of financial incentive, however, for companies to recycle slag, particularly in less developed areas in China, said Zhang.