Dozens of pollutant factories shut down in China

Another small galvanizing plant in Jijie, Handan City, Hebei Province, will soon have to close for failing to comply with environmental protection requirements, local media reported.

A total of 35 polluting factories were closed in the region after the government began to bring local campaigns to standards on environmental pollution. At the session of the People's Political Consultative Council, the issue of environmental protection again became one of the hot topics. With the introduction of new laws on environmental protection in early 2015, polluting enterprises were obliged to stop production in a number of regions.

So on the London Metal Exchange (LME) nickel jumped after news of the closure of NPO producers in Shandong province, China. At the same time, the impact on the copper market will be small as the main smelters meet environmental standards. The ferrous metals market will be the hardest hit by the environmental campaign, as steel companies make up the majority of 45 closed-down plants in Linyi.

"The closure will reduce steel supply and this will support steel prices, but the commodity market is also subject to new rules that will undermine support for commodity prices," said an analyst at Galaxy Futures.

In addition, China is expected to close many mines this year as part of a program to improve production safety, protect the environment and combat overproduction. China's official government agency for occupational safety reported that 93 percent of mines in China are outdated and not safe. Thus, a list of equipment and technologies prohibited in the extraction of minerals has been published.