CHINESE INDUSTRY FROM THE AIR

Created: 4/1/1967

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STUDIES IN

INTELLIGENCE

A collodion ol articles on lhe historical, operational, docltlnal. and Iheorctical aspects ol intelligence.

All statements of fact, opinion ot analysis expressed in Studies in Intelligence are those of

the authors They do not necessarily reflect official positions or views of the Central Intelligence Agency or any other US Government entity, past or present. Nothing in the contcnis should be construed as asserting or implying US Government endorsement of an article's factual statements and interpretations.

Fuieiyn-Dinrm

How ihe photo inierptetet helpsami appraise key contributors to Mao-land industrial output.

CHINESE INDUSTRY FROM THE AIR Wa B. TomliniOQ

Wheo the Crcat Leap Forward collapsedcone of silence" descended over China. Mainland newspapers and magazines ceased to contain meaningful statistics on industrial activity in the country, radio broadcasts were emptied of all but propaganda, and travel by foreigners was largely restricted to tours of First Class Communend the Creat Flood Control Dam of the Mangu. Even onof plants and equipment from abroad there wasostly forfeiture of associated guarantees because foreign technicians were not permitted to install them and the supplying countries were not even informed of their location. This almost complete blackout of information would have left the economic-industrial intelligence officer quite desperate had it not been for the arrival on the scene of daring Chinese Nationalist pilots flyingircraft nowfrom their former duty over the steppes of the industrial giant to the north.

High-altitude photography of course brings important information to others in the community besides the economist, notably to military intelligence officers, but in this article we are concerned only with the service it performs for the disciple* of Samuclson and Calbraith. Taken alone, its information on industrial activity in Communist China givesinimal foundation for intelligence estimates. When correlated with pie-blackout data and the limited current in-fomatioo that comes in from other sources, however, it enables us to draw many valuable conclusions about the Chinese economy today. Though its usefulness with respect to different industries varies from high to negligible, over-all it isignificance for China to the annual statistical yearbook for Soviet industry.

Pre-Blockou Onto

The basic store of information on Chinese industry goes back to before the Communist takeoveruch of the mainland in-

dustrial base was established by then. The huge iron and steel complex at Anshan and many of the varied todus trial activities at Shanghai annd Wuhan and in other widespread areas were developed by the Japanese during their occupation. Then many plants damaged in the war were restored or reactivated, some with VS. assistance,5o that much information is available on these from Chinese Nationalist. Japanese, and VS. sources.

I>iring the Grstears of the Mao regime, when therereat deal of industrial expansion and modernization, thereported openly about the progress they were making. This information was by and large reliable; the achievements of thein this period, compared with the Nationalists' record, were impressive enough to need nocnsiderable amount of accurate Information thus came out of China up

When9 the Communists attempted to make it in one great leap to the forefront of the industrial nations of the world, they not only established completely unattainable goals but also reported incredible progress towards them. Almost all of the information they issued at this time was impossibly warped or exaggerated. Eveo so. placed against the previous reporting, it gave some insight into actual accomplishmeiits. When the great silence enveloped the countryood basic reservoir of data oo the Industrialwas available to the economic intelligence officer.

Aerial Photographij: Spotting and Typing

Aerial photography's most obvious and most frequent contribution to tbe production of econonuc-iisdustrial intelligence is in locating industrial facdities and discovering what they are for.omewhat less precise way it can help inlant's operational status andew cases even in estimating its current rate of production. It can also follow the progress of new construction from the initial clearing of ground to the completion of an installation.

It must be kept Lo mind, however, that for the production ofood deal of information must be available from other sources than aerial photography, aod studies in depth are required to create fromseful product The economic-mdustrialofficer must weave together the photo interpretation of an

stallation wilh UiformaUoo fiom ground observation of il. reports on equipment boused in il,nd apply to all this his knowledge of tbe industry la question and the particular practices of the country.

Some industries are readilyerial photos because of characteristic peculiarities either to the plant itself or in ancillary facilities. An eiccllent esamplc of distinctive industrialis presented by an integrated iron and steel plant, with its easily recognizable features such as blast furnaces, coke batteries, coteplant, open-hearth furnace buildings, and rolling nulls. Another easily spotted industrial facility is the petroleum plant: the tank farm jumps out at the PI on his very first scan. Tbe Urge potroom buildingsodern aluminum plant with their associated rectifiers and transformer stations are also easily distinguished even by the novice PI.

There are other mdustrial plants, however,rained PI can identify onlyareful scanning of tbe photograph. Falling into this category are copper refineries, fertilirer and most chemical plants, and cement (unless marked by horizontal rotary kilns) aod lime plants.

Finally, tome industrial activities canr.ot be identified from aerial photography attriking ciample of these is the manufacture of titanium: to the United States two of the leading titanium plants are currently housed in old steel works, without any alteration of their outward appearance. An identification of these from aerial photography alone would be likely toalse one. as steel mills of some sort.

Tbe correct identiPcaboo of ao installation may depend on getting accurate measurements of its features. If it is co-located with others, relative sire is often enoughlue, but otherwise realareoodicture will yieldof weUdefined lines such as the clean sides of buildings toeet and of clearly discernible heights to withineet.

Operational Status; Sew Construction

In many industries the most telltale signlant is in active operation is the presence of smoke, steam, or dust. At an iron and steel plant, for example, the quenching of cokeeavy cloud

of steam, and the open-hearth and bessemer converter furnaces {for making steel from iron) and soaking pits (for equalizing temperatures in an ingot) emit smoke. Thermal power plants are usually heavy smokers. Cement plants in operation feature large quantities of smoke and dust. Many other mdustrial activities emit enough smoke or steam to be detected in the photography. Sometimes, as in power plants, the quantity of smoke may vary with the level of operation, but in most cases smoke onlyacility to be active.

A better indicator of level of operation at many industrial plants is the extent of associated railroad activity. Many plants require ainflux of raw materials andonstant outflow of finished product by rail. The number of raQroad cars at orlant is thus oftentockpile of rawores,gfve'a clue to the operational statuslant, but this indicator Isand often misleading. Often the sire of the stock of raw materials is inversely related to the operational level of the plant, and sometimes it is static regardless of plant operation.

An Important variable in determining operational status Is theof photographic coverage needed.umber of industries, fortunately, particularly those that use largo furnaces, frequentis not practical. Once temperatures are raised to operating levels, operation is continuedong time before shutdown for maintenance or other reasons. Thus one can forego aerial coverage for fairly long periods with reasonable confidence thatlant of this kind was operating before and after, it was probably operating during the interval as well. The length of the period will vary among industries; the PI, as he progresses in the mastery of his'will use bis judgment in respect to it

At new construction in progress, aerial photography offers aseat Starts can be identified early If tbey involve clearing or grading the site, and the entire construction cycle can then be followed, including the laying of access roads or railroad spurs, the erection of security fences, and the completion of administration buildings. The enlargement of an existing plant can be watched in the same way. For the internal modification of existing facilities there are clues such as the presence of building materials orbut the insight they offer is obviously quite limited.

An Iron and Steel Plant

The Wuhan iron and steel plant will serveood example from this industry, showing how well it lends itself to identification. As can be seen from the aerial photograph innd the drawings in Figurehe basic features are readily identifiable. The three large blast furnaces that reduce the ore are easy to discern. Although their unique configuration precludes close measurement of their size, there is collateral mfonnarjon on the precise volume of almost all blast furnaces in China today; no new ones have been built for the past six or seven years. Of these.olumeubic meters.ubic meters^axlclubic meters.

The open-hearth building with six tall smokestacks also stands out The smoke coming from the top of the building indicates that the shop was probably operating when this photo was taken even though no smoke can be seen corning from the stacks. Collateral mtelhgence puts six fumaccs in this building, five large onesons end one of half that capacity. One furnacetackommon practice,umber of plants have two on each. The open-hearth budding is large enough to accommodate these six

The soaking pit area, although its identification would be difficult for an amateur, can be seen by the trained PI. Tbe same is true for the coke ovens, some of which steam shows to have been operating when the picture was made. The number of ovens per battery Is very difficult to tell from aerial photographs, but for this again there is collateral information, much of It pre-Cornmunlst, oo this and other iron and steel plants in China.

The rolling mill area, where the steel is worked beyond the ingot stage, can be delineated easily, but aerial photography provides the least useful information about this part of the plant. Collateral sources are unfortunately also the least informative oo this subject, so that the weakest estimates about today's Chinese iron and steel industry are on its ability to turn crude steel into finished products. Overall, our best conclusion is that China does not have the rolling facilities to process all its crude steel. The number of rolling mills at Wuhan, however, indicates that this plant can roll all the crude steel it produces into some kind of finished or semifinished product. What the mix naiehr. be cannot be ascertained.

la sum. lhe following estimates can be made on the Wuhan plant by evaluating the combined iniormation from all sources:

Pig Iron capacity isillion tons per year with all three blast furnaces operating full time, according to collateialAerial photography permits the conclusion that the plant was probably operatingigh rateeasonable estimate of its pig iron production8 would therefore beillion tons.

A crude steel capacity of aboutillion tons Is derived from collateral reporting. Aerial photography leads to thethat the open-hearth shop was probably operating near capacity allo wellxultion tons of crude steel was probably produced. Tbe excess pig iron is sent to Shanghai for process log.

Finished steel capacity is not given in collateral reporting, but the number of rolling mill buildings visible lends confidence to an estimate that all the crude steel produced here is probably rolled into some finished or semifinished form. Applying the usual rule of thumb that finis bed steel amounts to aboutercent of the crude, we get somewhatoillion tons as Wuhan's finished product

Aluminum

Probably the second most easily identifiable industrial facility is the modern aluminum plant Because it recovers the metal by electrolysis, it must have an easily spotted transformer station and rectifier buddings, along with distinctive potroom buddings (theelectrolytic cells ares can be seen in Figurehowing the Fushun aluminum plant, the unique configuration of the potroom buddings is easily singled out by the PL Their outside measurements (usually' wide and* to more' long) are easy to determine, and thereood rule of thumb for deriving plant capacity fromton of aluminum metal per year for every square yard of gross potroom Boor space. At the Fushun plant gross potroom area is0 square yards. The indicated capacity of0 tons per year roughlyearlier collateral informationapacityons was planned. Aerial photography shows the plant is operating, probably close to capacity.

There ere two other completed aluminum plants in China, but photography showed only ooe, that at Pao-tou, to be operatingtotroorn floor space0 square yards, so the whole industry could probably baveaximum ofons of aluminumhere are also four aluminum plants under construction in China, and their progress towardsis currently being mOnitOrcd from the air.

Cement

Although the cement mdustryecentralized one, spread out across China, photography Is available on most of the majorhen they are operating, large quantities of smoke and dust are emitted from the stacks, and this telltale evidence is clearly visible. With high-quality photography the number of kilns operating, out of the total number, can be determined, to give tbe percentage of plant capacity being utiuzed.ypical Chinese cement plant.

Although cement is not itself to exotic commodity, an Increase in Its prcduetion Is highly luggcstive of industrial expansion. Tho was one of the early indicators of industrial revival in China after the collapse of the Creat leap There is one reservation about cement output estimates made from aerial photography. The higher the quality of tbelant turns outiven period of time, the lower the tonnage. The photography gives no insight into quality, and so collateral information Is required for fully reliable production estimates.

Electric

,.

High-altitude photography ts ol great value in determining the ersstence and location of power plants, and it gives reasonablymeans for estimating their capacity. Successive photographs of the same plant show any additions to its capacity. Estimates of actual output, however,reat deal of subjectivity inthe photographs. Estimates of tbe level of operation at time of photography are less than sure, and extrapolation from these to an annual output depends on the validityumber of technicaland assumptions. Estimates of output derived from this source must therefore be regarded as Indicatingossible general order of magnitude.

With respect to capacity, Ihe moat accurate estimates can be made on the new Soviet-built plants in China. In wluch the turbogenerators are placed lengthwise in the generator hall In these there arerelationships between tbe layout and dimensions of tbe boiler house and generator ball oo the one hand and the capacity andof generating units installed oo tbe other. The number of units and the capacity mix can be further pinned down by observing tbe wire leads from tbe generator hall and the boiler connections to the sinokestadcs. The standard relationships do not bold for otherplants, in which tbe generator units are frequently placed cross-wise in the hall Here aerial photography provides only generalof capacity such as the size and number of cooling towers, and collateral information is essential for tho number and capacity of the generators.

For hydroelectric power plants, which are not standardized in China, aerial photography sometimes reveals tho number of generator

units installed, but often it can only assist in verifying or revising esti-males of capacity based on collateral information.

Estimating the level of operation is extremely difficult Thefrom aerial photography is smoke, but this is an ambiguousthe amount of smoke emittedtack depends onirKluding the efficiency of the boiler, the type of coalwhether the boiler has (ust started operation. In thevery efficient units with smoke-control apparatus may giveobservable smoke. It is believed that in China, however,smoke-control measures and the use of poor-grade,more smoke cominglantigher totenjfty

operation.ew cases the amount of steam visible has been used to estimate the level of activityower planthows the Kunming power plant emitting heavy smoke from its stacks. It is supposed to have been operatingather high rate when the photograph was taken.

Cmn#i* Industry

Copper

Most of the Chinese copperoncentrated at four large combination planU at mine sites. These plants process the ore, smelt it into blister copper, and then rcGnc this electrolytically into commercially pure metal. The otedressing facilities, usually locatedillside, can be distinguished by (he steep roof-lines of the crusher and concentrator buildings. Dewatering tanks and tailing dumps are often abo seen. The smelter usually has one or more tall smokestacks, anywhereeet high, from whichloud of dense white smoke when the smelter is operating

Tbe refinery proper has 'no 'outstanding peculiarities which will invariably distinguish it from other types of industrial plants,umber of features taken together suggest its purpose. The refining buddings include those with characteristic furnace stacks where the electrolytic anodes and commercial shapes are cast and thetankarge power bouse or subiUuoo will be associated with the tank house and the carting building.

No reliable floor-space-to output formulas have yetopper refinery, but rough comparisons in size between the Chinese plants and those in the USSR where production rates are known give at least an order of magnitude for Chinese production. The analogy is more than assumed: the four major Chinese plants were built with Soviet aid and are of basic Soviet design. Although the Soviets withdrew before all of them were completed, most of the equipment had already been supplied. All four were operating6 at what appeared under aerial surveillance to be good rate).

Railroads and Other Uses

Aerial photography is of little use In determhiing the production of railroad rolling stock, but itirect and accurate means ofthe development of the railroad networkountry. It has been especially useful in application to the more remote areas ofChina. From the initial preparation of the roadbed through the construction of tunnels and bridges to tbe final laying andof track, the whole construction process can be watched. Cood-quality photographs even show trains in transit on the completed lines. The determination ol traffic densityarticularery difficult problem, and here the results from aerial

photography, although some rather sophisticated methodologies have been tried, still leave much to be desired.

Some insight into capacities or operational levels of other sectors of the Chinese industrial base can be gained from aerialand the purpose of new construct von can often bet is associatednown installation. Plants pointed out by other sources can be watched and in some cases their operational status de fined.

The ovcr-all level of Industrial activity in China can I* surmised by projecting tbe activity in the key Industries discussed above,the Iron and steel Industry. Sometimes referred to as tbe "bellwether" of an economy, certainly steel output signals the general trend of economic activity in China, even though its correlation with CNP, national' income, and tbe index of industrial activity is oot perfect. The more skiDful we can become io evaluating high-level photography on the most photogenic industries the better we will be able to assess the general economic situation in China.

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