China city shuts steel mills to clear air for Games

SHANGHAI (Reuters) - A northern Chinese city near Qinhuangdao, one of the sites of this month's Olympic soccer matches, has ordered the shutdown of steel mills accounting for 2 percent of China's steel output, industry sources said on Monday.

Qian'an, 75 kilometers (46.6 miles) west of Qinhuangdao, ordered all steel mills expect for a unit of Shougang Group to halt production until the Olympics end, in order to improve air quality for the matches, a trader and two steel mill officials said.

A Qian'an public affairs official was unable immediately to confirm the shutdown.

The steel mills set for temporary closure have combined annual crude steel capacity of about 12 million tonnes, the sources said.

The mills produced 5.69 million tonnes of crude steel in the first half of this year, compared with 263.19 million tonnes nationwide, official data showed.

The order was issued by the provincial environmental protection bureau and was likely to be expanded to neighboring areas where other steel makers are located, industry website Mysteel reported on Monday.

"They said we would face a penalty if we disobeyed the order, and could resume production quickly after the Olympics," said an official with a private-sector steel mill in Qian'an city. Qian'an is also 200 kilometres east of Beijing.

China has announced a series of emergency measures to be taken in and around Beijing if air quality remains poor during the Olympics, including taking more cars off the roads and slashing production at more than 220 factories.

The radical plan will be carried out if air quality is forecast to be short of acceptable standards for the following 48 hours due to extremely unfavorable weather conditions, the Ministry of Environmental Protection has said.

(Editing by Edmund Klamann)