Beijing's big steel maker announces Games pollution cut

BEIJING, July 14 (Reuters) - One of China's biggest steel makers, Shougang, has announced it will slash production at its Beijing plant, bowing to pressure to help clean the city's grimy skies for the Olympic Games.

Shougang Iron and Steel Group 000959.SZ will "limit production during the 2008 Olympic Games period, reducing as far as possible pollution emissions during the Games period," it said in a statement over the weekend on the website for the Shenzhen stock exchange (www.cninfo.com.cn), where the Group is listed.

Confirming earlier statements, the Group said that in the third quarter output of iron, steel and steel products at its Beijing plant will shrink by 50 percent compared with the same period last year.

Beijing's chronic pollution has been one of the biggest headaches for Games organisers, who have vowed that restrictions on traffic and factories will bring blue skies and easy breathing for athletes during the Aug. 8-24 Games.

Shougang, whose name means "Capital Steel", is the worst polluter in the city. It is moving production to a 10 million tonne, state-of-the-art mill on the nearby coast of Hebei province that is slated to be fully ready by 2010.

Shougang was originally due to end all operations at its mill in the west of the city before the Olympics, but now plans to fully close that plant by the end of 2010.

City officials told Shougang to restrict production to 200,000 tonnes per month over the Games period, a cut that will reduce its emissions by 70 percent, a company executive said last year.

The Shougang announcement did not say when it will begin the production cuts, but the Beijing government issued rules in April ordering industrial firms such as Shougang Group to reduce or stop production from July 20.

As part of the Games anti-pollution drive, hundreds of factories in provinces surrounding Beijing will also face production cuts or freezes over coming weeks.

From July 1, vehicles that fail to meet emissions standards have been banned from entering downtown Beijing. And from July 20, Beijing will launch a traffic control system to take half of the city's 3 million cars off the road, using an odd-even licence plate system. (Reporting by Chris Buckley; Editing by Ken Wills) (chris.buckley@reuters.com; +86 10 66271261)