Decline is inevitable and the company is the architect of its own failure, according to Du Peng. "The most advanced steel-rolling equipment in the mill was a second-hand machine imported from Ukraine in the 1990s. The Ukrainians had used it since the late 1970s," he said. "Who would rely on such outdated machines to restore a business against today's fierce competition?"
Falling output
Jigang mainly produces steel plates, deformed steel bars for the construction industry and screw-thread bars which are used to reinforce small ships.
Its annual output of crude steel rose from about 7 million metric tons in 2000 to more than 12 million tons in 2007, when the government paid special attention to expanding the production capacities of a number of industries. Last year, Jigang produced just 6 million tons of crude steel.
"It's a pity the company didn't increase investment in the research and development of new products and technology during the good times. It just expanded its production capacity as fast as possible, just as long as its products made money," Du Zufeng said.
Jigang workers often cite the privately operated Rizhao Steel Group as a comparison. The company, also known as Rigang and located in Shandong's Rizhao city, is much smaller than Jigang, but far more profitable.
It has imported advanced equipment from Italy to produce special steel that can be used in the aerospace and aviation industries and in the construction of expressways.
Rigang has a geographical advantage, too, because it is located near Rizhao Port, a large coal and iron harbor on the Yellow Sea. By contrast, Jigang is 300 km from the nearest port and 90 percent of its iron ore is imported by ship.
"More important, Rigang operates like a modern enterprise, while Jigang runs like a small club," said a retired steelworker surnamed Rong. "The company provided everything - from daily life necessities to apartments, education to medical care," said the 70-something lifelong Jigang employee.
Having joined the company in 1965 at age 19, Rong feels the steel mill is his home. "All of the older workers feel they are the owners of the mill. And we know everyone in each other's families. We will never take the initiative to quit our jobs, but the younger workers only see Jigang as an employer."
Du Peng admitted that he has mixed emotions about quitting. "My feelings about Jigang are complicated because my grandparents were among the first generation of workers, the people who built the mill from zero in the 1950s. My son also grew up here," he said.
In 1958, the Qingdao Railway Bureau transferred his grandparents from Qingdao to help construct the steel mill. Once they arrived in Jinan, they joined tens of thousands of workers from around the country, including a large group from the Anshan Steel Group in Liaoning province, founded in the 1920s by Japanese forces who occupied Northeast China at the end of the Russo-Japanese War (1904-05).
That history is the reason Jigang workers speak in their own distinctive accent, a combination of the accents of Jinan and wider Northeast China.
A family affair
Du Peng has four uncles and an aunt. All of them worked for Jigang in some capacity, with the exception of one uncle. Instead, he was assigned to work as a doctor in Linyi county in Dezhou, Shandong, during the "educated youths" campaign of the 1970s, when students were sent to "learn from the peasants", as Mao Zedong put it.
"My uncle tried his best to transfer back to Jigang, but now he would rather stay in Dezhou," Du Peng said.
