Guangdong's steel giant is shifting its 15 million tonnes a year operation out of Guangzhou to an industrial hub 400 kilometres away.
The 35 billion yuan (HK$39.8 billion) move by the Guangdong Iron and Steel Group is seen as part of the company's long-awaited restructuring, while at the same time helping the environment.
In a joint briefing with the Development and Reform Commission of Guangdong, commission chairman Li Miaojuan said the group would adopt more environment-friendly steel production.
It will phase out its 15 million tonnes of annual steel production and instead turn out five million tonnes of fine steel in the port city of Zhanjiang, western Guangdong, in a bid to meet the province's demand for high-end products, Li said.
Zhanjiang's Donghai Island has one of the best harbours in the country and could become a base for giant iron, steel and petrochemical plants.
Li said the move was necessary and urgent as the group's production hub in Guangzhou had been putting tremendous pressure on the city's effort to protect the environment.
