On December 27, 2014, China Cement Association held the north china cement company's staggered production conference in Jinan. This meeting was a very important meeting. It was very timely. It was a concrete study of how to further consolidate and expand the achievements of the staggered production of cement. The conference was also a meeting to implement the 41st Document [2013] of Our Country, resolve the problem of the overcapacity of cement, promote energy-saving and environmental protection, and promote the industry to improve quality and efficiency. I give firm support on behalf of the Ministry of Industry and Information Technology! We warmly congratulate the conference!

There are three points for your reference.

I. Staggered production of cement is of great significance

In recent years, haze covering a large area frequent occurred across the country, especially in the northern region, causing deep hate of the masses. There are many reasons for haze weather, but in the final analysis, it is caused by human overproduction over the environment. So to speak that the superposition of burning coal for heating and industry in northern China is also one of the main reasons. At present, cement industry is still a big industry with high energy consumption and high emission. Although Chinese cement industry has reached the world's advanced emission standards upon technological progress in recent years, this does not mean that all enterprises meet the emission standards. Besides even if they meet the standards, there is still high emission load. Currently, the overall capacity of cement is surplus in China, especially severe in the Northeast and Northwest regions, and North China. Under such circumstance, vicious market competition occurs constantly. The more enterprises produce, the more losses there are. For example, in recent years, cement industry in Xinjiang is developing rapidly, with a serious overcapacity and the capacity utilization rate less than 60%. In the first 10 months of this year, production capacity increases, while the production and sales dropped sharply compared with that in the same period last year. Moreover, there is a huge loss when the industry profits and losses are offset. Xinjiang cement phenomenon is like a "mirror", as well as sounds the alarm to the national cement industry.

We imagine that if, in a period of environmental sensitivity in winter, cement industry avoids the peak of heating in winter. That is, they do not produce cement in winter but produce at full capacity in other three seasons, with peak seasons covering the shortage of slack season. Not only the total amount of cement but the benefits will not decrease, thus reducing the cost and increasing the efficiency. It will improve labor conditions of workers and staff, without affecting the market demands. Also, it will help to resolve partial excess capacity, as well as to save energy and reduce emissions, reducing pollution, mitigating and reducing the weather of haze. Therefore, staggered cement production is not only to dissolve excess capacity, but to solve the problem that when to produce will be more beneficial to the country, the environment, the industry, and the enterprise, instead of simple restricting output of the insured price. Also, it is a scientific and reasonable allocation, organization and scheduling of social resources. This is really a meaningful thing, benefiting the country and the people. We can do well by pilots. Then make it normal upon summary and perfection.

II. We achieve positive progress of staggered production of cement

During the two sessions this year, CPPCC (Chinese People’s Political Consultative Conference) members jointly proposed the staggered production of cement. Later, there was Economic Reference in-depth report obtaining opinions from the leaders of the State Council, and great concern and expectation from all social aspects! The leaders of our department attach great importance to this and have made instructions specially. Main leaders of our Department of Raw Materials also paid great attention to it, instructing the Building Materials Department to actively contact the Association and the China Building Materials News for a series of investigations, and to take advices from relevant departments. On this basis, on August, we submitted it to the head of the Ministry that Research report about the staggered cement production (hereinafter abbreviated as Report. The Report proposed four suggestions of public opinion promotion, government guidance, association coordination, and pilot establishment, receiving instructions from the Ministry leaders. At present, positive progress has been made on this work, mainly manifested as follows:

(1) Xinjiang and the three northeastern provinces have taken the lead in building the pilots. Staggered cement production is a systematic project, involving a wide range of areas, with strong policy and technology, and complex specific operation. In order to actively and steadily promote this work, we first establish pilots in Xinjiang, where the market is relatively independent, and the three northeastern provinces, with a high degree of industrial concentration and a certain work basis. Significant progress has been made as a result of the previous phase of supervisor-subordinate communication and promotion by all parties. At the end of September, the Commission Economy and Information Technology and the Environmental Affairs Department of the Xinjiang Autonomous Region jointly printed and issued Notification about relevant requirements on the implementation of staggered cement production. It was decided to implement hiemal staggered cement production for a period of 4 months from November 1st. On November 29th, cement enterprises of the three northeast provinces jointly signed the Letter of commitment—Cement industry in Northeast China implement the hiemal staggered production, promising that start from December 1st, conduct the 4 months’ staggered cement production.

(2) The publicity significantly strengthened its promotion role. After Xinjiang took the lead in the implementation of "staggered production", my Division timely published relevant information on the official website of the Ministry, while China Building Materials News also followed up the reports. This news, reprinted by the media, attracted widespread attention of public opinion, and played a model role in promoting the conduction of staggered cement production in the three provinces of Northeast China. In particular, with the help of the conference held in Shenyang on November 29th on the Staggered production of cement enterprises in the three northeastern provinces, we together with the China Building Materials News, invited Comrade Zhai Huisheng to attend and speak, the CPPCC member of press circle and the secretary and vice chairman of the  CPA(Chinese Press Association) Central Committee, who put forward the proposal of " staggered production" during the "two sessions", which further aroused the mainstream media’s attention. People's Dail", Xinhua News Agency and Economic Daily and the like were all took the prominent positions, publishing and broadcasting relevant news and comments in the first time. People's network, China economy net, Kwangmyong net, China network, Sina, Tencent and other mainstream networks also reprint one after another. Beijing TV, Beijing People's Broadcasting Station and other television broadcasting media also reported on about this matter in news programs. The media generally gave positive comments, saying that the staggered cement was not only conducive to resolving overcapacity, energy saving and emission reduction, but also helpful to reducing the environmental pressure during the heating season in the northern region. It also benefited the standardization the competition order, promoting the construction of corporate integrity and fulfillment of their social duties. It should be mentioned that the media’s attention and publicity promoted staggered cement production.

(3) Government support and strength of leadership gradually increased. Xinjiang’s implementation of staggered cement production has been supported by the government from the beginning to the end. The autonomous region government has held a special meeting to study the problems of chaotic competition order, price dumping, loss of the whole industry caused by overcapacity in cement industry and took staggered cement production as one of the major measures to solve the problem. The relevant departments implemented the spirit of the government meeting and issued policy documents on the staggered production in time.

In order to effectively promote the pilot work of staggered cement production, our Division request the relevant provincial and regional industry management departments to participate actively, supporting the industry association to coordinate the enterprise to carry out the staggered production. Xinjiang, in the process of formulating the staggered production plan, sought the advice from our Division main leaders of which expressed their support precisely. On October 23rd, our Division sent personnel to give support and guidance on "Xinjiang working conference about staggered production of cement enterprises" in Urumqi, I comrade of industry management from three northeast provinces were also invited to attend the meeting to learn from.

In order to speed up the implementation of staggered production in the three Northeast provinces with the help of Xinjiang's practice, on November 20th, the Division held a symposium in Beijing on the staggered production in the three Northeast provinces pilots, inviting comrades of the Xinjiang Commission of Economy and Information Technology to introduce the production practices and implementation of the staggered production as well as listening to the opinions of cement enterprises, associations and competent departments of the three provinces of Northeast China. The meeting called on all parties to unify their understandings, ideas, and actions, and to put the staggered cement production of the three northeast provinces into practice as soon as possible.

On November 29th, upon the promotion and support of our Division, the China Cement Association organized a Winter staggered production conference of the three Northeast provinces cement enterprises in Shenyang. Upon the efforts from all parties, especially the large enterprises such as North cement of China Building Materials, Jilin Yatai and the like took the lead, and the participating enterprises reached a consensus and decided to take unified action to implement staggered production. Responsible comrades of the industry management departments of the three northeast provinces attended the meeting to express their firm support.

(4) Give full play to the role of industry association. Xinjiang Building Materials Association has played an important role in the implementation of staggered cement production. They took the initiative to carry out research and investigation, listen to the opinions of enterprises and relevant parties, put forward proposals, and win the support of the Commission of Economy and Information Technology and environmental protection departments of the autonomous region who introduced documents relating to staggered cement production. At the same time, in order to stabilize the market order during the staggered production, the association, in conjunction with the Commission of Economy and Information Technology of the Xinjiang Autonomous region and the Bureau of Industry and Commerce, printed and issued a Notice on standardizing the operation order of the cement market. We formulated a industrial self-discipline pact, took a clear-cut stand against price dumping, and organized and established a supervision and inspection mechanism with enterprises as the main body. The China cement Association made great contribution to led and coordinated local cement association from the Northeast three provinces to conduct specific promotion work when three Northeast provinces followed and implemented staggered production after Xinjiang.

From the current point of view, the more than a month's staggered production in Xinjiang implemented well. The cement market order began to improve, while cement price and enterprise benefits rebounded. Northeast three provinces implemented staggered cement production also nearly a month. Except for a few enterprises’ special circumstances needed appropriate grace period at the beginning, now all enterprises have basically, according to the requirements, implemented the staggered production.

I should like to inform you by the way, recently, we reported staggered cement production progress on the previous stage to the Department leaders, receiving the Ministry leadership’s full affirmation. They instructed: This work is very meaningful and should be upheld. In the next step, we will pay close attention to the staggered cement production as a key task.

First, continue to strengthen contact and communication with local industrial and information competent departments and industrial associations, closely track the staggered production process in Xinjiang and the three northeastern provinces, promptly identify and solve the problems. Strengthen coordination and guidance to guarantee staggered production running smoothly. Second, Push other provinces and regions in the north to establish pilots and carry out the staggered cement production. Support the China Cement Association to lead and strengthen the coordination and communication among local industry associations from Beijing, Tianjin, Hebei, Inner Mongolia, Shanxi and Shandong and other provinces, who shall, with reference of the practice of the Northeast three provinces, as soon as possible to implement staggered cement production. Third, actively communicate with relevant departments to study the policies supporting the staggered cement production. We will, together with relevant functional departments, such as development and reform, environmental protection, industry and commerce, to study policies on differential electrovalence, environmental regulation, finance, taxation, and standard market competitive order through summing up the practical experience of staggered production in this winter.

III. Do well in implementation of staggered cement production in Pan-North China

Pan-North China has a vast territory, involving many provinces and a large number of enterprises, so it is difficult to implement the staggered production. At the end of 2013, there were nearly 1,000 cement enterprises above designated size in the pan North China, capacity of which accounted for nearly 20% of the country, with a relatively severe excess capacity. Despite the difficulty, based on the needs of the industrial development situation and driven by the staggered production in Xinjiang and the three provinces, the cement enterprises in this region carried out the staggered production with high enthusiasm. On 17th this month, the China Cement Association convened a forum of partial large-scale key cement enterprises in Beijing. Through discussions and exchanges on the forum, the consensus was basically formed. Hence today the hiemal staggered production conference of cement enterprises all over Pan-North China is held in Jinan. Just now, the President of Shandong Building Materials Association, Wang Fujiang, read out on behalf of the cement industry within the region the Self-discipline pact of implementing staggered production by cement enterprises within Pan North China.  The Pact is well developed, which stresses principles and distinguishes between specific situations and is of strong operational.

The next critical step is to do the following aspects:

The first is to unify our thoughts. we should fully understand the significance of the cement peak shifting production at present, and look overall situation, know wisely, truly unify our thoughts into the industry consensus.

The second is to unify our action. the self-discipline convention signing for the cement peak shifting production is the guide to action, we should act in accordance with the convention, consciously start from everyone, honor credibility and take responsibility.

The third is to adhere to a down-to-earth working style. Now there are still half a month away from the implementation date of the staggered peak of the Convention. When we go back, we must immediately start operations, make full preparations, and arrange production and business operations and the life of employees. Everyone must immediately start the work after the conference, make full preparations, and arrange the production and management of the company and the life of the employees, and so on.

The fourth is to strengthen supervision and inspection. The provincial-level industry associations can take the lead and companies can dispatch staff to carry out the necessary supervision and inspection on the implementation of the staggered production of cement. The provincial department of industry and informatization must fully support it.

The fifth is to increase publicity and guidance. The mainstream and influential media such as China Building Materials News, China Cement Magazine, and Digital Cement Network should continue to pay attention to the work of the staggered production of cement, publicize advanced and typical experiences, and expose disadvantaged groups.

In short, the staggered production of cement is an innovative work. If all of us can unite consensus, work hard towards a common goal, continue to sum up and improve, and make sure that all measures are implemented, we will certainly be able to receive real results and make new contributions to the stable growth of the entire industry and structural adjustment!