About 10,000 people protested in Xiantao on Sunday, the state-backed Global Times reported, citing a local resident, even after the local government said it planned to suspend the project on Sunday morning.
Another resident told Reuters by phone on Monday that the protests continued, and several protesters were injured in clashes with riot police.
“There are hundreds of police here because of the demonstrations,” said the resident, who declined to give his name because of the sensitivity of the matter.
The city government called on residents to refrain from taking “extreme actions” and spreading rumors in a statement on its official microblog.
Tens of thousands of “mass incidents” – the usual euphemism for protests – happen in China each year, spurred by grievances over issues such as corruption, pollution and illegal land grabs, unnerving the stability-obsessed ruling Communist Party.
Last June, thousands of people protested in Jinshan, about 60 km (37 miles) from China’s commercial hub of Shanghai, against plans to build a chemical plant in the district.
A Xiantao official said that the planned plant’s emissions of dioxin, a toxic compound, would have been in line with European Union standards, state media reported.