China Shilu Steel Mill in Hainan goes bankrupt

As the severe crisis in China’s steel industry continues, another significant bankruptcy has emerged from Hainan Province. The Shilu Steel Plant in Hainan has been officially declared bankrupt by the People’s Court of Changjiang Li Autonomous County. The company’s assets will be put up for public auction on April 30, 2025.

Among the items to be auctioned are the land-use rights of the plant’s production area—covering over 128,000 square meters—and 22 buildings with a total construction area of 6,220 square meters. The starting bid for the auction is set at 19.45 million yuan, with a required deposit of 3 million yuan for participation.

Part of the land being auctioned is reportedly contaminated, and the buyer will be responsible for cleaning up the pollution and restoring the site in accordance with environmental regulations. Furthermore, any additional infrastructure redevelopment costs will also be borne entirely by the new owner.

This bankruptcy is part of a broader economic downturn affecting China’s steel industry. According to a report by Bloomberg Intelligence, nearly 75% of Chinese steel producers reported losses in the first half of 2024. Experts warn that this trend could trigger a wave of bankruptcies and accelerate the consolidation of the sector.