To lift steel output, Chinese forge ahead with old plants

China's economic planners have shifted their priority in steelmaking from building brand new plants to improving existing ones. This is part of the realism that has succeeded the euphoria of late 1978 and early 1979, when Chinese leaders were talking of raising steel output to 60 million tons by 1985 and of building two or three entirely new plants as part of a plan to have 10 major steel centers by that date.

Now, construction work is going ahead on only one new iron-and-steel plant, at Baoshan in Shanghai, with the technical assistance of Nippon Steel, the Japanese steel giant. Elsewhere, as at the shoudu (capital) IRon & Steel Company here in PEking, management concentrates on improving the efficiency of existing plant and equipment, even as it carries out a gradual program of replacing old facilities with new ones.

Li Wenchi, shoudu's deputy general manager, told a press conference recently that his company has increased output by nearly 50 percent in two years, using the same equipment. His figures: 1977 output, 500 million yuans' worth ($333 million); 1979 output, 749 million yuans' worth ($498 million).

Mr. Li is a bustling, energetic person with the booming voice of a drill sergeant. "Companies must make profits," he told a roomful of correspondents who had just toured shoudu's sprawling facilities in the western suburbs of Peking.

"If I had talked about profits to you during the Cultural Revolution, I would have been labeled someone who thought only about money. Fortunately those days are behind us. In 1977 our profits came to 100 million yuan [$66.66 million]. In 1979 they reached 230 million yuan [$153.3 million]."

Mr. Li said that Shoudu's output last year was 2.38 million tons of pig iron, 1.47 million tons of crude steel, 1.12 million tons of blooms (units of raw steel), and 480,000 tons of rolled products.

In addition, an iron mine owned by Shoudu near Tangshan, about 90 miles eastward, produced 11.24 million tons of iron ore last year, he said. This ore has an iron content of 27 percent -- approximately the same as the iron ore mined in the Mesabi Range near Lake Superior. Bethlehem Steel has a contract t increase the output of the mine by several times, over a five-year period, through automation and the use of modern equipment and procedures.

Shoudu's proudest achievement is the completion of its No. 2 blast furnace late last year. Whereas the three other blast furnaces produce a total of just over 2 million tons of pig iron, No. 2 by itself will produce 1 million tons of pig iron. Its capacity is 1,327 cubic meters, and it is bell-less -- that is, it is not covered by a bell-like top, as most blast furnaces are. There are only a few such blast furnaces in the world, said Gao Bocung, our guide, who is deputy chief engineer -- five in Japan, three in the United Kingdom, and one belonging to Bethlehem Steel in the United States.

The bell-less blast furnace utilized 37 new technologies, he said, all developed in Shoudu's own research laboratory. No foreign technology had to be imported.

The advantages of the system were twofold: The structure was 30 tons lighter, and because pressure at the top was higher, the use of coke could be reduced. At present, the older blast furnaces had reduced use of coke from 455 kilograms per ton of pig iron to 433 kilograms. When the new blast furnace has been in operation a year, Mr. Gao said, coke utilization could probably be reduced to 400 kilograms per ton of steel.

Other steel plants must begin to match Shoudu's record. One independent observer estimates that although China produced more than 30 million tons of steel last year (official figures say 34.43 million tons in 1979, making China the world's fifth-largest steel producer), up to 9 million tons was probably unusable.

This was partly because of pook quality and partly because, not being sufficiently geared to their market, steel mills still tend to produce excessive amounts of types and varieties of products not in great demand, and insufficient amounts of those products that are in demand. The government has been cracking down on this practice, rejecting the notion of production for production's sake that prevailed in earlier days. Still, China must import large quantities of stell from abroad each year.