Are your suppliers affected? Shanghai Government to shutdown 255 factories!

What happened?

In advance of the G20 Summit to be hosted at the beginning of September in China, the Shanghai government will be closing down 255 of its industrial facilities in order to reduce pollution before the arrival of world leaders. The shutdown period will be August 24 through September 6 and affects facilities from different industries within a radius of 150 km of Hangzhou, close to Shanghai.

According to industry and government officials, authorities in neighboring Zhejiang and Jiangsu provinces are set to issue similar orders to limit air pollution and safety hazards within a 300 km radius from Hangzhou.

This approach is not unusual. China has undertaken similar efforts to achieve a temporary smog lift in advance of other high profile events such as, the 2008 Olympics, the Shanghai World’s Fair in 2010, and the Asia-Pacific Economic Cooperation Summit in 2014.

These types of shutdowns can have a huge impact on your supply chains which make immediate actions mandatory.

Do you know if your suppliers are affected?
We have a list with all current factories affected and would like to offer you our immediate support.

 


As of June 2016


  • Power, steel chemical and petrochemical operations must limit their air pollution by 70 percent throughout the city, and by 80 percent in Jinshan District.
  • Petrochemical operations in Shanghai must reduce production with a target of 50 percent.
  • Production by coal-fired power stations will be reduced by 30 percent and all facilities must use only low-sulfur, high-quality coal.
  • All chemical plants in the Jinshan District, save for those operating out of Shanghai Chemical Industry Park, will be closed.
  • No new operations resulting in increased emissions at chemical and petrochemical facilities will be permitted.
  • “Highly polluting” vehicles – a term which the Plan does not define– will be prohibited in Hangzhou.
  • The use of agricultural, forestry, and port equipment shall be reduced by 30 percent across Shanghai and by 50 percent in Jinshan District.
  • Gas stations, oil storage facilities and oil tanker trucks that have not installed oil and gas reclamation and emissions control equipment must cease operations.
  • The Plan allows for the adoption of additional measures if certain weather patterns are forecast that might increase air quality issues.

Things you should do immediately:

  • Check if your suppliers are within the region of the factory shutdowns
  • Contact your suppliers and clarify if they are affected by the shutdowns
  • Check to see which of your suppliers (n-Tier) are receiving goods from the affected region (especially from chemical, electro mechanical, building material, and pharmaceutical industries)
  • Monitor all suppliers which could potentially be affected in case of further shutdowns or increased regulations from the Shanghai government – we recommend on a daily basis
  • Leverage this increased visibility to proactively secure your supply before your competitors do

Contact us today so we can start helping you identify if your suppliers are affected!

* mandatory field

How can riskmethods support you?

  • Create transparency in your (n-tier) suppliers and supply chains in the affected region and beyond
  • Provide early-warning system with near real-time alerts (see screenshot right) for your suppliers and supply chains in case of further shutdowns or increased regulations
  • Visibility into your supply chain within 24 hours