Shanxi's first pollution company relocation hearing led to four major issues - the relocation of the Oak Group
October 01 10:19:46, 2025
Shanxi Synthetic Rubber Group, the leading domestic manufacturer of chloroprene rubber, has become the first company in Shanxi Province to face relocation due to severe pollution. The company has drawn widespread criticism from local authorities and residents after being cited for environmental violations. On October 21, the Datong Environmental Protection Bureau confirmed that despite the company’s claims of addressing pollution through production control, enhanced environmental measures, and advanced industrial treatment, it attended the relocation hearing. However, the local government remains firm in its stance that the company must be relocated rather than simply restructured.
Originally established as the People's Liberation Army's No. 3528 factory, the company was set up in a location that is now considered environmentally sensitive. Located at the upwind outlet of Datong City and within a water conservation area, the plant continues to emit dust and smoke that affect the urban environment. Its waste has caused serious damage to both air and water quality. Due to technical limitations, lack of funding, and outdated facilities, the pollution issue has remained unresolved for years. Some employees have suffered from occupational diseases, including hair loss, raising further concerns about health risks.
In February, the Standing Committee of the 13th Municipal People’s Congresses of Datong proposed a resolution regarding the environmental impact of Shanxi Synthetic Rubber Group. The committee passed a decision to investigate the serious pollution and potential hazards associated with the company’s operations. It concluded that even if the company meets national emission standards, achieving zero emissions is currently impossible, making relocation the only long-term solution.
On September 27, Datong hosted the first relocation hearing in Shanxi for a polluting enterprise, focusing on the relocation of the neoprene rubber production project of Shanxi Synthetic Rubber Group. All stakeholders except the company itself agreed that the pollution problem had reached a critical stage, requiring a comprehensive solution—similar to the relocation of Shougang, a well-known steelmaker.
Although relocating polluting companies is not a new concept, this case has sparked significant attention, especially within the chemical industry in Shanxi. One major concern is who will bear the massive relocation costs. According to the Datong Economic Commission and representatives of the company, the relocation could cost over one billion yuan, a sum neither the city nor the company can afford alone. It is expected that the central or provincial government will need to provide financial support.
Another key issue is what happens after relocation. If the company moves to the Yanggao Industrial Park, it would be relocated eastward. However, regardless of the location, the core challenge remains pollution control. Officials believe that the current situation makes it difficult to fully resolve the pollution problem, which raises concerns that relocation might just shift the environmental burden elsewhere.
The fourth point of discussion is who will replace Shanxi Synthetic Rubber Group. Shanxi is among the most polluted provinces in China, and there are several other heavily polluting but economically significant companies in the region. While Shanxi Synthetic Rubber Group may be the first to relocate due to pollution, it is unlikely to be the last.
Finally, the impact on the domestic neoprene industry is another concern. Currently, only two companies in China—Changshou Chemical Plant and Shanxi Synthetic Rubber Group—are capable of producing chloroprene rubber. Since 2000, foreign manufacturers from Japan, the U.S., and the EU have flooded the Chinese market with low-cost products. In May, the Ministry of Commerce imposed a five-year anti-dumping duty on these imports. Whether the company relocates or expands, its actions will significantly affect the domestic supply chain.
While the relocation of Shanxi Synthetic Rubber Group seems inevitable, some industry experts argue that the process should be carefully planned. They warn that without proper consideration, the relocation could lead to a situation where "old problems are not solved, and new ones arise."