Changing industrial location─How and why does it change over space and time? Part 3 3.3 How has the location of the iron and steel industry in China changed over time? © Oxford University Press 2009 Changing industrial location─How and why does it change over space and time? Part 3 The manufacturing system of the iron and steel industry Inputs Manufacturing processes Physical inputs 1 Raw materials, including coal, iron ore/scrap iron and steel, and limestone 2 Land Cultural inputs 1 Power supply 2 Capital 3 Labour 4 Technology 5 Transport 6 Government policies 7 Management 8 Market Cash © Oxford University Press 2009 Iron ore/scrap iron and steel, coal and limestone Molten iron Slag Iron making Molten iron Steel making Casting Rolling and shaping Outputs Market Finished products (example) 1 Steel tubes and pipes 2 Steel sheets Waste 1 Hot water 2 Slag Changing industrial location─How and why does it change over space and time? Part 3 What are the factors affecting the location of iron and steel works? Socio-economic factors • Government policies (offering grants and subsidies) • Large capital • Agglomeration (able to benefit from agglomeration economies) • Advanced technology and innovation, dependent on automation Site factors • Extensive flat land • Communication systems: By rail or by sea © Oxford University Press 2009 Operation factors • Raw materials: Iron ore/scrap iron and steel, coal and limestone • Power: A large amount of coal • Skilled labour • Market: Large cities and industrial centres • Management • Clients (industries that use steel products) Part 3 © Oxford University Press 2009 Changing industrial location─How and why does it change over space and time? Part 3 Changing industrial location─How and why does it change over space and time? How important is the iron and steel industry in China? The iron and steel industry is known as ‘the backbone of all industry’ as it provides basic _____________ raw materials for many other industries. Do you know what Iron and steel China’s rank in the industry is terms very world is in important of steelto China. production? A pile of steel bars © Oxford University Press 2009 Part 3 Changing industrial location─How and why does it change over space and time? How important is the iron and steel industry in China? World total: 1,344 million tonnes China is the largest steel producer and consumer in the world. In 2007, it makes up about _____% of the 36 global crude steel production. © Oxford University Press 2009 Changing industrial location─How and why does it change over space and time? Part 3 How important is the iron and steel industry in China? Crude steel production in China, 1955-2007 In the 2000s, fast growth has taken place. After the 1980s, the Before the 1980s, the growth of has been production crude up. steel speeding was growing very slowly. Source: China Statistical Yearbooks © Oxford University Press 2009 Why do such changes occur? Part 3 Changing industrial location─How and why does it change over space and time? What is the spatial distribution of the iron and steel industry in China? After decades of development, large numbers of iron and steel plants have been scattered over the country Many of the iron and steel firms are ( small / big ) After several rounds of merging and ( efficient / inefficient and regrouping, five major iron and) steel centres have developed Major iron and steel centres in China © Oxford University Press 2009 Changing industrial location─How and why does it change over space and time? Part 3 How has the location of China’s iron and steel industry changed over time? Since the 1950s, there have been two stages of development in the iron and steel industry in China. Stage 1: Inland shift of industries (early 1950s to late 1970s) Stage 2: Economic reform period (1980s and the early 2000s) © Oxford University Press 2009 Changing industrial location─How and why does it change over space and time? Part 3 Why do some iron and steel plants remain in their original locations? Have you noticed Why does which major iron and Angang continue steel centre thrives to operate at the throughout ________ Angang in the same location? period from the Liaoning. 1950s to present? Reasons: Building an iron and steel works is costly. It would be a waste if the plant does not operate. Closing down the plant would cause unemployment and ( lower / higher ) tax revenue in the region. Industrial _______ inertia © Oxford University Press 2009 It would adversely affect other related industries. Changing industrial location─How and why does it change over space and time? Part 3 How has the location of China’s iron and steel industry changed over time? To conclude … Will there be further changes in the location factors of the iron and steel industry? © Oxford University Press 2009 Changing industrial location─How and why does it change over space and time? Part 3 Will there be further changes in the location factors? 1 Government policies The influence of the _______________ economic market has become more important. Local governments have tried to provide favourable policies to the iron and steel enterprises. They also help the enterprises in loaning and funding, land renting approvals and taxes. © Oxford University Press 2009 During the two stages in the development However, in recent of the iron and steel years, the central industry, influence control on the industrial ofand the planning central policies government has been has been reduced. dominant. Changing industrial location─How and why does it change over space and time? Part 3 Will there be further changes in the location factors? 2 Raw materials and power The production of iron ore and coal cannot meet the rapid growth of the industry. China has to rely on imported iron ore and coal because of shortage of raw materials and power. Shortage of power has caused temporary blackouts in many areas in east China. © Oxford University Press 2009 Changing industrial location─How and why does it change over space and time? Part 3 Will there be further changes in the location factors? 3 Transport Low railway capacity has resulted in imported iron ore piling up in the main harbours. Rail transport (Credit: Panorama Stock Photo Co. Ltd.) © Oxford University Press 2009 Changing industrial location─How and why does it change over space and time? Part 3 Will there be further changes in the location factors? 3 Transport All of the major iron and steel centres are located at or north of the Chang Jiang Transporting iron and steel products requires high transport costs Places south of the Chang Jiang are undergoing a fast pace of economic development © Oxford University Press 2009 Changing industrial location─How and why does it change over space and time? Part 3 Will there be further changes in the location factors? 4 Market As economic development in Central and West China increases, there will be increasing demand for iron and steel products in these regions. Lanzhou, Gansu Province, a city in Central China (Credit: Tsui Chung Pong David) © Oxford University Press 2009 Changing industrial location─How and why does it change over space and time? Part 3 Will there be further changes in the location factors? 5 Environmental concerns The emission of dust from the iron and steel industry took up 15% of the total volume in China in 2007. Coal is an important power resource for the iron and steel industry. Burning coal causes ____ air pollution which, in turn leads to smog, acid rain and reduced visibility. It also emits carbon dioxide which intensifies greenhouse effect ________________. The iron and steel industry is also the most serious source of ______ water and _____________ pollution. solid waste An iron and steel works in China (Credit: Nie Ming/FOTOE) © Oxford University Press 2009 Changing industrial location─How and why does it change over space and time? Part 3 Will there be further changes in the location factors? 5 Environmental concerns Beijing The air pollution caused by Shougang in Beijing is so serious that the central government has decided to move the production plant away. Caofeidian Caofeidian What are the location advantages of Caofeidian? a deep, frost-free and silt-free harbour near large ports such as Tianjin The present and new location of production plants of Shougang © Oxford University Press 2009 Changing industrial location─How and why does it change over space and time? Part 3 Will there be further changes in the location factors? To conclude, what are the location factors affecting the future location of the iron and steel industry? A location which is: • close to markets; • with good transport networks; • far away from the densely-populated urban areas. © Oxford University Press 2009 Changing industrial location─How and why does it change over space and time? Part 3 Stage 1: Inland shift of industries (early 1950s to late 1970s) 1950s Anshan Coalfields Major coal mines Iron ore Major iron and steel works Other iron and steel works © Oxford University Press 2009 In this period, iron and steel works were mainly concentrated in the north-east, for example, _________. Anshan What were the major location factors of the iron and steel industry in China during this period? Why? Changing industrial location─How and why does it change over space and time? Part 3 Stage 1: Inland shift of industries (early 1950s to late 1970s) 1970s … and even to the West, e.g. Ürümqi Anshan Baotou Taiyuan Wuhan Panzhihua Coalfields Major coal mines Iron ore Major iron and steel works Other iron and steel works © Oxford University Press 2009 What were the major location Can Howyou did give the factors of the distribution any examples of iron and of themajor ironsteel and iron steel and works steel industry in change centresinduring found China the inthis the period? Central? 1970s? Inland shift to the Central ... Part 3 Changing industrial location─How and why does it change over space and time? Stage 1: Inland shift of industries (early 1950s to late 1970s) Government policies played a major role on the inland shift of the iron and steel industry. 1 3 Strategic Social reasons: reasons: Theachieve To central agovernment more balanced Moving the industries realized that economic development the major threat of into the inland Inland shift ofto war was from throughout theJapan wholeand country the safeguard them industries USA. Factories in the coastal To relieve the problem of areas could be easily attacked ______________ overpopulation in the coastal Locating near to iron 2 regions Economic reasons: raw ore fields: _______ Raw materials: material _________-oriented Heavy To lower iron ore and transport and limestone Locating near to coal costs bulky mines: _________power Power resources: oriented coal © Oxford University Press 2009 Changing industrial location─How and why does it change over space and time? Part 3 Stage 1: Inland shift of industries (early 1950s to late 1970s) Government policy is a particularly important location factor in China not only in this period but also in the later period. Do you know why? Most iron and steel plants are owned by the _______. state Their locations have been subject to the changing priorities of the ________-planned economy during state different periods. © Oxford University Press 2009 Changing industrial location─How and why does it change over space and time? Part 3 Stage 2: Economic reform period (1980s to the early 2000s) 1970s Early 2000s Beijing Anshan Shanghai Wuhan © Oxford University Press 2009 What Howare does the the major CanThere you name is a distribution location factors of iron of some of and the major general shift to the and iron steel works steel iron the and ________ coastal change industry during in steel China this centres? regions. nowadays? period? Changing industrial location─How and why does it change over space and time? Part 3 Stage 2: Economic reform period (1980s to the early 2000s) 1 Government policies In 1978, Deng Xiao-ping adopted the _______ open policy. Have some regions developed first! Deng Xiao-ping © Oxford University Press 2009 Economic development has been concentrated in ________ coastal areas Changing industrial location─How and why does it change over space and time? Part 3 Stage 2: Economic reform period (1980s to the early 2000s) 2 Technological advancements Less coal and iron ore are used Use of new furnaces Lower transport costs of power resources and raw materials Use of bulk carriers and better railway transport The location importance of _________________ power resources and _____________ raw materials decreases The location importance of ________ coastal market and __________ _________ location increases © Oxford University Press 2009 Changing industrial location─How and why does it change over space and time? Part 3 3 Favourable location factors in coastal regions A Well-developed infrastructure in coastal regions Main railway line Line under construction Railway junction/Terminus km © Oxford University Press 2009 N These facilities enable the easy ______ importof raw materials and easy _______ ofexport finished goods. Good port facilities (Shekou Port, Shenzhen) Changing industrial location─How and why does it change over space and time? Part 3 3 Favourable location factors in coastal regions B Existence of industrial centres What other favourable location factors do coastal regions ( Small / Big ) have? markets _______________ Agglomeration economies Abundant supply of skilled __________ labour © Oxford University Press 2009 Changing industrial location─How and why does it change over space and time? Part 3 3 Favourable location factors in coastal regions C Sufficient supply of cooling water and extensive flat land Extensive ___________ flat land Can get land through reclamation ______________ © Oxford University Press 2009 Water for cooling _________ Changing industrial location─How and why does it change over space and time? Part 3 Stage 2: Economic reform period (1980s to the early 2000s) 4 Problems of inland areas Problems in the Far away from inland areas major markets discourage industrial development. Mainly ( skilled / unskilled ) labour © Oxford University Press 2009 Poor transport networks and ( low / high ) accessibility ( Mild / Extreme ) climate ( Small / Large ) population ( Gentle / Rugged ) relief Uneconomical to exploit the inferior quality of coal and iron ore in inland regions