November 11, 2016 / 2:36 AM / in a year

China meets 2016 target for steel capacity cuts: state planner

BEIJING (Reuters) - China has come in ahead of schedule in its target of cutting 45 million tonnes of steel capacity in 2016, reaching the goal before the end of October, the country’s state economic planner said on Friday.

An employee works at a steel factory in Dalian, Liaoning Province, China, June 27, 2016. Picture taken June 27, 2016. REUTERS/Stringer

China also hoped to achieve its 2016 goal of cutting 250 million tonnes of coal capacity before the year-end, Li Pumin, general secretary of the National Development and Reform Commission (NDRC), told a news briefing.

China plans to eliminate 100 million to 150 million tonnes of annual steel production over the next five years as the industry battles with excess capacity.

However, steel capacity cuts have so far done little to rein in output, and Europe and the United States have accused China of dumping its excess steel overseas, hitting producers and hurting global prices.

Thermal coal prices have hit fresh records on an almost daily basis in recent weeks after government-enforced closures earlier this year tightened supplies for power utilities, triggering a scramble ahead of the winter.

Li said China will balance coal supply and demand to ensure stable prices.

China’s power consumption in the first 10 months of 2016 rose 4.8 percent from a year earlier, the NDRC said.

The state planner also said it has approved 15 fixed-asset investment projects in October totaling 218.8 billion yuan ($32 billion).

Li said the government will step up investment in key areas of the economy, including water conservancy, urban sewerage drainage and rural infrastructure.

The government will also increase efforts to attract private investment in infrastructure projects via public-private partnerships, Li said.

Reporting by Kevin Yao and Beijing Monitoring Desk; Writing by Ryan Woo; Editing by Richard Pullin

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