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Despite the absence of strict mandates, Chinese ferro-alloys producers are increasingly adopting sustainability reporting as part of their carbon reduction and green transition efforts, aiming to boost competitiveness and secure a stronger role in the global low-carbon supply chain amid the country’s evolving ESG framework.
Although China has not adopted a mandatory framework for sustainability reporting equivalent to the EU’s Corporate Sustainability Reporting Directive (CSRD), the country has been rapidly advancing its ESG (Environmental, Social and Governance) disclosure regulations.
Sustainability reporting remains voluntary in most cases, except for certain listed companies and state-owned enterprises (SOEs) in high-emission sectors.
In late April 2025, Qunxian, a major manganese alloys producer, launched its first ESG report.
“As a private enterprise, we are not required to disclose ESG information,” the company said. “But we chose to do so to demonstrate our determination and confidence in the green transition.”
Industry observers viewed this as a significant step.
“Qunxian’s ESG reporting sends a strong signal that Chinese ferro-alloy producers are moving toward standardized sustainability disclosures,” a market source told Fastmarkets.
Other producers have taken similar actions.
Jiaocheng Yiwang, a ferro-manganese producer, released an environmental impact report in December 2024 after upgrading its four plants.
Xinganglian, a leading ferro-chrome producer, was awarded the Sustainability Award by the International Chromium Development Association (ICDA) on May 14 for its eco-friendly practices.
Chinese producers are aligning with a broader global shift toward sustainability. Since 2023, international ferro-chrome companies – including Outokumpu, Vargön Alloys, Tata Steel Mining, Jindal Stainless, Glencore, ERG and TELF – have pledged commitments to decarbonization and climate action.
With carbon trading expanding and rising downstream demand for sustainable materials, the Chinese industry’s green transformation is viewed as not just a regulatory necessity, but a strategic business imperative, according to sources.
Sustainability reporting is also positioning Chinese ferro-alloys producers for potential inclusion in the national carbon trading market.
China expanded its emission trading system (ETS) in March 2025 to cover steel, cement and aluminum smelting, with over 300 steel companies included by May.
“The ferro-alloys industry could be next due to its high carbon footprint,” a producer source said. “By improving sustainability now, companies can ease compliance when regulations tighten.”
Under China’s cap-and-trade system, companies exceeding emission limits must buy carbon permits or offset emissions via China Certified Emission Reductions (CCERs).
“Steelmakers under the ETS will increasingly demand low-carbon raw materials, including sustainably-produced ferro-alloys,” the producer added.
China’s abundant renewable energy resources are accelerating the ferro-alloys industry’s green transition.
In 2024, 58.2% of China’s 3.35 billion kWh installed power capacity came from solar and wind, the country’s Administration of National Energy data shows.
Inner Mongolia, a major ferro-alloys hub, hit a record 135 million kWh in green electricity installed capacity in 2024, according to data from the Energy Administration of Inner Mongolia.
Ulanqab – a city in Inner Mongolia that produces one-third of China’s ferro-alloys – aims to have 60% green power in smelters’ energy mix by 2025.
Local governments are also supporting the shift, with Inner Mongolia encouraging long-term green power contracts between generators and industrial users and Ningxia releasing an action plan targeting 60% renewable energy usage in ferro-alloys production by 2027.
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