(Yicai Global) July 1 -- Panzhihua in southwestern Sichuan province, one of China’s earliest and biggest iron and steel manufacturing bases, wants to exploit its rich natural resources to become a top developer of titanium and vanadium products.

Panzhihua, nestling at the confluence of the Jinsha and Yalong rivers, has the world’s largest titanium reserves and the third largest vanadium reserves on earth. It is the biggest vanadium and titanium product manufacturer in China, but there remains a lot of room for improvement.

Most of these products are low-end as they do not involve much fine finishing and processing, Kong Qingxi, deputy director of Panzhihua’s municipal development and reform commission, told Yicai Global. Panzhihua is trying to achieve technological breakthroughs in this regard, for instance, in the field of vanadium redox batteries.

Situated deep in China's hinterland, Panzhihua became the largest steel maker in western China when the government moved a lot of industry inland from the coastal regions in the 1960s for national defense reasons.

There is not much capacity for the steel and iron sector to develop further, Kong said. The Panzhihua Iron and Steel Group is already producing six million tons of steel and iron a year.

The presence of vanadium in the local iron ore makes the steel produced by Panzhihua Iron and Steel highly resistant to abrasion and very smooth. Heavy rail tracks have become its signature product and it produces around 40 percent of the rail tracks for China’s high-speed trains.

The city’s mild climate and fresh air also makes it a popular health retreat. Around 100,000 people, many of them senior citizens, descend on the city each winter. The health industry accounted for 20 percent of the city’s industrial added value last year at CNY13 billion (USD2 billion).

Editors: Liao Shumin, Kim Taylor