Ports will help bring new tide of prosperity

On Nov 5, a coal port owned by SDIC Caofeidian Port Co, a subsidiary of the State Development and Investment Corp, was put into use. Construction work, including 10 coal berths and 18 store yards with total capacity of 8.37 million tons, started in 2006. The coal port alone has an annual capacity of 100 million tons.

The second phrase of Caofeidian coal port, which garnered investment of 5.4 billion yuan ($857 million), will be put into use in the first half of 2013 and a third coal port, with investment of 5.2 billion yuan, is still under construction, according to Yang.

"The planned coal capacity of Caofeidian will reach 350 million tons," she said.

Workers check seawater desalination equipment at Shenhua Group Co in Cangzhou, Hebei province. [Photo by Zou Hong / China Daily]

There are a number of steel companies, including Hebei Iron and Steel Group Co and Shougang United Iron and Steel Co, in the province, and the coal and iron ore ports provide easy access to the fuel and raw materials they require, which helps to reduce costs.

"Importing iron ore at Caofeidian port has greatly helped nearby steel mills to reduce their logistics expenses," said Wang. "Plus, the port helps to deliver coal from the north, China's major coal producing area, to the southern provinces which are big consumers of electricity."

Both of China's major coal mining areas, Shanxi province and the Inner Mongolia autonomous region, neighbor Hebei. Coal and related products are transported to Qinhuangdao and Caofeidian ports and then distributed in the south of the country.

Qinhuangdao had a turnover of about 227 million tons of coal by mid-November, according to statistics from JYD Online Co Ltd, a bulk-commodity consultant in Beijing.

"The cost of transporting coal from the mining areas to Caofeidian is lower than to Qinhuangdao," said Dai Bing, director of the coal industry information department at JYD. "Caofeidian also has a greater number of highways than Qinhuangdao."

The Chinese government has encouraged the increased importation of fossil fuels, such as coal, and Caofeidian's location is more convenient for coal exporters overseas compared with Qinhuangdao port, he said.

Based on the port economy, the district will increase its efforts to establish trading centers for six major commodities, including coal, steel, iron ore and gas, which are intended to provide services for Chinese and foreign companies to start businesses in the region, according to the local government.

Meanwhile, next year will see construction start on an oil-refining project with an annual capacity of 10 million tons, a seawater desalination project with planned daily output of 1 million tons, and two power plants.