Asian Metal visits Hongyuan Chemicals, Hunan Nonferrous and Chuangyuan Aluminum

On January 10-11, 2013, Asian Metal visited Yizhang Hongyuan Chemicals Co., Ltd., Hunan Nonferrous Fluoride Chemicals International Trading Co., Ltd. and Hunan Chuangyuan Aluminum Co., Ltd..

On the morning of January 10, senior analyst Friday Gao and analyst Grace Wang from Asian Metal firstly visited Yizhang Hongyuan Chemicals, a new aluminum fluoride plant with capacity of 80,000tpy. Mr. Wang Youlun, vice marketing general manager of the company, talked about the current aluminum fluoride market with Asian Metal. Mr. Wang pointed out that the current firm aluminum fluoride market may not last for a long time due to sufficient supply. According to Mr. Wang, China should release strict regulations and would not approve any new aluminum fluoride projects. Because of the oversupply, they plan to focus on overseas market in the long run.

In the afternoon, Asian Metal visited Hunan Nonferrous Fluoride Chemicals, an old aluminum fluoride plant with capacity of 180,000tpy. Because of sluggish market, the stream efficiency for the plant remained at around 50-60% in 2012. According to Mr. Zhang Yahong, vice general manager of the company, they produced around 100,000t of aluminum fluoride in 2012. However, the output may decline in 2013, as some new aluminum fluoride projects will take away some market share. In addition, although aluminum fluoride prices increased a lot in the past few months, they still suffer losses due to rising cost. The product cost is around RMB8,000/t.

On January 11, Asian Metal visited Chuangyuan Aluminum, a major aluminum ingot plant with capacity of 300,000tpy. Mr. Zhang Xingqiang, director of purchasing department and Ms. Xiong Zeying, purchasing manager from the company talked about aluminum market with Asian Metal. Ms. Xiong revealed that Chinese alumina production cost kept rising and China may import more alumina in the future.