China to Check Overcapacity of Flat Glass Industry

New projects should get approval from national authorities, said an online notice from MIIT about controlling overcapacity and guiding the healthy development of the country's flat glass industry.

"Relevant local authorities should pay close attention to the overcapacity issue and adopt effective measures to contain the fast growth of flat glass production," said the notice.

The country will work to weed out 26 million weight cases of backward capacity in the flat glass sector in 2011, it said.

Further, it will raise the ratio of deep processing enterprises to 45 percent through mergers and restructuring while promoting the output of the sector's top 10 companies to take up 75 percent of the total during the country's 12th Five-Year Plan period (2011-2015), it added.

It also urges local governments to drive technical innovation among flat glass producers, strengthen their management over the sector and guide local enterprises to invest rationally.

In 2010, the country built 34 new flat glass production lines, which could produce 130 million weight cases more flat glass, bringing the total production capacity to 890 million weight cases, the notice said.

However, the output of the country's flat glass industry was only 630 million weight cases last year, marking a 70 percent capacity utilization in the sector, it noted.

Presently, the country has around 30 production lines under construction or yet to be constructed, which will release another 100 million weight cases of capacity if put into production, underscoring the sector's overcapacity issue, it said.

Since last May, the country has been pushing forward the progress of phasing out outdated capacities and suspended approvals of energy-intensive and high-polluting construction projects in 12 industries, including flat glass, iron and steel, cement, coke and electrolytic aluminum, according to the MIIT.