China’s top steelmaker Baowu Steel Group and regional producer Fujian Sangang Group have signed agreements to invest 20 billion yuan ($3.09 billion) in two separate steel projects in the southeastern Fujian province, local media reported on Tuesday.
Southern regions are an increasingly popular investment destination for steel mills in China, the world’s top producer of the metal, due to rising demand and more lenient environmental regulations compared with the more polluted north.
Baowu-controlled Taiyuan Iron and Steel Group will invest 10 billion yuan in a Fujian project that aims to produce 3.22 million tonnes per year of stainless steel, according to the local government-backed Fuzhou News.
Fujian Sangang, owned by Fujian provincial government, will splash out another 10 billion yuan on facilities to make fine steel products and related infrastructure including a docking berth, the report said, without putting a capacity figure on the project.
Fujian churned out 38.6 million tonnes of steel products last year, according to the National Bureau of Statistics.
Stainless steel makers Baosteel Desheng, Tsingshan Holding Group and Fujian Fuxin Special Steel all have mills in the province.
Meanwhile, Wuxi Xinsanzhou Steel Co will invest in a 3.5 billion yuan cold-rolled steel project in Fujian, the Fuzhou News reported, with annual capacity set to reach 1.1 million tonnes. ($1 = 6.4689 Chinese yuan renminbi) (Reporting by Min Zhang and Tom Daly, editing by Louise Heavens)