Chinese steel giant Shougang, formerly based in the capital of China, started moving to Hebei Province in 2005 after Shougang Jingtang United Iron & Steel Co was set up, with Shougang and Tanggang taking 51% and 49% stakes respectively. It was designed with annual capacity of 15 million tonnes, producing mainly high end flat products.

In light of industrial blueprint, Shougang and Tangshan should lead the smaller steelmakers in North China for forging one of the steel bases.
Though Caofeidian aims to make its production value an equivalent to Wuhan Steel's Fangchenggang project by 2010, Wuhan Steel and Baosteel have made aggressive acquisitions in past years, a threat to Shougang.

Mr Xu Xiangchun a Mysteel analyst said that "Shougang is looking to take this advantage for upgrading the product mix from low end construction steel to the high end."

Mr Xu said that Shougang should focus on purchasing small and medium scale steelmakers in future. The relocated steelmaker has set off on this. It started the cooperation with Tangshan Baoye and is in the process of restructuring Jiujiang and Songting steel, while planning to build a new construction steel plant in Shanxi.