Gu Weihua: Tungsten electrode industry faces big opportunities and challenges in 2015, while quality is company’s core competitiveness

Asian Metal：Mr Gu, please tell us something about your company.

Gu：Our company was set up in 1999 and we have three tungsten electrode plants, which are Jiande Hengshan Tungsten Industry Corp. Ltd、Winner (Hang Zhou) Tungsten Product Co., Ltd.and Zhaoheng Winner(Shimen) Tungsten Product Co., Ltd.. The total production volume is 600 tonnes per year.

Asian Metal：Influenced by the gloomy economy, demand for tungsten electrode remains soft both at home and abroad. What are your thoughts about the production situation in domestic tungsten electrode plants at present?

Gu：It is hard to summarize the data in detail, but most domestic plants are running with low production rates this year influenced by dim downstream demand. We understand from tungsten bar suppliers that the total purchasing volume from the tungsten electrode industry has reduced by a third this year, which shows that orders for tungsten electrode are not looking favorable.

Asian Metal：Tungsten raw material prices are constantly on the decline. Is this a good or a bad thing for the tungsten electrode industry?

Gu：On the one hand, raw material prices are decreasing and downstream plants such as ours can reduce production costs to some extent. But it is bad for the market if prices keep going down this year as the prices of our products will also decrease along with raw material prices and consumers will lose confidence in the market and place fewer orders in the spot market.

Asian Metal：As domestic tungsten electrode suppliers are having to compete fiercely for limited orders, what strategy will your company adopt when addressing the current situation?

Gu：Firstly, we should maintain our regular customers. Secondly, we will pay more attention to the quality of our products. Thirdly, we will expand our marketing channels and develop new customers both at home and abroad. Next year we will focus on the North China market and send more distributors.

Asian Metal：What about the applications and demand for cerium tungsten electrodes, lanthanum tungsten electrodes and thorium tungsten electrodes?

Gu：Demand for thorium tungsten electrodes is greater than the others. But as it features radioactive elements in its production, it will be replaced by new materials sooner or later. We are trying our best to research and develop new products and our new composite tungsten electrode has obtained a patent, which has already been put into trial production both at home and abroad.

Asian Metal：Has the overall consumption of tungsten electrodes worldwide decreased compared to last year? What about Chinese consumption this year?

Gu：It is predicted that the total consumption volume for tungsten electrode in the world will be around 2,000t, down by 30% from that of last year. China only consumes 10% of the total volume, while Chinese plants can supply more than 80% of the world’s needs. So the export market is also an important market for tungsten electrode companies.

Asian Metal：What are the plans or particular advantages for your company in the future?

Gu：Our company will focus on producing tungsten electrode products and pay more attention to the quality and brand. We’re investing in the research and development of new materials and production lines. We are also cooperating with foreign companies and learning from advanced techniques and management to make our services and products better and better.

Asian Metal：What are your views on demand in the export market? How will you expand the overseas market and sharpen the international competitiveness of your company?

Gu：As the macro-economic environment is not favorable, it is predicted that demand from end users will not pick up in the near term. 2015 is an important year for tungsten electrode plants as the whole industry is facing a re-shuffle and survival of the fittest situation, a number of enterprises will be eliminated. We believe that quality is the main factor and we ensure that our clients get quality products and reliable services.

Asian Metal：Thank you very much for your wonderful interview. I hope your company enjoys a bright future.