Shanxi's first pollution company relocation hearing led to four major issues - the relocation of the Oak Group
October 01 10:05:40, 2025
Shanxi Synthetic Rubber Group, the largest domestic producer of chloroprene rubber, has become the first polluting company in Shanxi Province to face relocation due to severe environmental issues. The company has come under intense criticism from various parties, as its operations have caused significant harm to the local environment and public health. On October 21, the Datong Environmental Protection Bureau confirmed that although the company claims it will address pollution through production control, enhanced pollution prevention measures, and advanced industrial treatment, it still attended the relocation hearing. Despite these promises, the authorities remain firm in their stance that the company must be relocated rather than simply managed.
Originally established as the PLA's No. 3528 factory, the company was set up at the upwind outlet of Datong City, located within a water conservation area. As a result, its emissions continue to affect the urban atmosphere, while waste discharge harms both air and water quality. Due to technological limitations, financial constraints, and outdated infrastructure, the pollution problem has remained unresolved for years. Reports indicate that some employees have suffered from occupational diseases and symptoms like hair loss.
In February, the Standing Committee of the 13th Municipal People’s Congresses of Datong proposed a resolution regarding the environmental damage caused by the company. The committee passed a decision calling for an investigation into the serious pollution and safety hazards of the neoprene rubber production. It concluded that even if the company meets national emission standards, achieving zero emissions is currently unattainable, making relocation the only long-term solution.
On September 27, Datong held the first relocation hearing in Shanxi Province concerning a polluting enterprise, specifically for the neoprene rubber project of Shanxi Synthetic Rubber Group. All parties except the company itself agreed that the pollution issue must be thoroughly addressed, with relocation being the most effective approach—similar to the case of Shougang.
Although relocating polluting companies is not new, this case has drawn widespread attention, especially within the chemical industry in Shanxi. One major concern is who will bear the enormous relocation costs. According to the Datong Economic Commission and representatives from the company, the cost could exceed 1 billion RMB, which neither the local government nor the company can afford alone. The state or provincial government would need to provide financial support.
Another key issue is what happens after relocation. The assumption is that the company will build a new facility in the Yanggao Industrial Park and move eastward as soon as possible. However, regardless of whether it moves, the core challenge remains pollution control. Officials believe that the current situation makes it difficult to resolve the pollution issue fundamentally, raising concerns that relocation may just shift the problem elsewhere.
A third focus is on who will replace Shanxi Synthetic Rubber Group in the future. Shanxi is one of the most polluted provinces in China, and there are several other heavily polluting but industrially significant companies. While Shanxi Synthetic Rubber Group may be the first to relocate due to pollution, it is unlikely to be the last.
Lastly, the impact on the domestic neoprene industry is a major concern. Currently, only two companies—Changshou Chemical Plant and Shanxi Synthetic Rubber Group—are capable of producing neoprene. Since 2000, foreign manufacturers from Japan, the U.S., and the EU have flooded the Chinese market with low-priced products. In May, the Ministry of Commerce imposed a five-year anti-dumping duty on these imports. Whether the company relocates or expands its production, it will significantly affect the domestic supply chain.
While the relocation of Shanxi Synthetic Rubber Group seems inevitable, some industry experts argue that the decision should be made carefully. They emphasize that the relocation plan must address all critical issues to avoid repeating past mistakes—where old problems are not resolved, and new ones arise.