STICK IT: An exhibitor demonstrates new handling technology at the Eighth China (Shenzhen) International Logistics and Transportation Fair held in Shenzhen, Guangdong Province on October 14 (MAO SIQIAN)

Cutting Overcapacity

The State Council is tackling production overcapacity, according to a statement on October 15.

The Guideline to Tackle Serious Production Overcapacity lists five prime sectors with serious overcapacity: cement, electrolytic aluminum, sheet glass, shipping and steel. The move is key to achieving stable growth and upgrading the Chinese economy.

The guideline lists tasks to deal with overcapacity, including forbidding new projects that aim to expand capacity and reappraising projects currently underway.

Growth through innovation should be stressed and mergers encouraged. Domestic and global demand should be explored, consolidated and expanded. Government should work toward better allowing the market to determine demand.

Stricter Rules

The Ministry of Commerce (MOFCOM) on October 15 called on baby formula importers to be more accurate when recording sales data and for no monopoly in the industry, which has been plagued by quality and price-manipulation scandals.

The MOFCOM vowed to provide more convenient approval procedures for qualified importers, but told them to set reasonable prices and eradicate price manipulation and other moves that amounted to unfair competition.

In August, Chinese authorities fined six baby formula companies that operate on the Chinese mainland, namely Biostime, Mead Johnson, Dumex, Abbott, Friesland and Fonterra, for a total of 670 million yuan ($108 million) following an anti-trust investigation.

The National Development and Reform Commission said formula producers set minimum resale prices for distributors and punished those who sold their products at lower prices by suspending supplies or ending contracts.

Tapping Natural Gas

The China National Petroleum Corp. (CNPC), a parent company of the nation's top oil and gas producer PetroChina, predicted on October 14 that its natural gas supply at home will increase 13 percent during the upcoming winter and spring seasons.

A company spokesman said the CNPC expects its gas supplies during the two seasons to total 57 billion cubic meters.

The company forecasted the hike amid robust natural gas demand as some Chinese cities begin using natural gas instead of coal for winter heating in order to reduce damage to the environment.

In a government action plan unveiled in September 2013, China vowed to take a multi-pronged approach to tackling air pollution by cutting coal use, shutting down polluters and promoting cleaner production.

Under the plan, the country will boost supplies of natural gas, coal-based substitute natural gas and coalbed methane.