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Interview with Quan Pengcheng, director of alumina supply department, Bosai Minerals Group Co., Ltd.
Bosai Minerals Group Co., Ltd. is a privately-owned comprehensive Group with businesses covering industrial minerals development, fusion-manufacturing and international trade. The main products are met-grade Alumina, Aluminum, Brown Fused Alumina, Calcined Bauxite, Coke and Coal.
Bosai Minerals Group was established in 1994. Up to the end of 2008, it had total assets over RMB 3.6 billion and more than 5,000 employees, including 500 foreign employees. Bosai Minerals Group owns more than 10 plants，companies and offices in Chongqing, Tianjin, Sichuan province,Guizhou province, Guangxi province and Co-Republic of Guyana. Their products are sold in more than 20 countries and areas in the world, such as Europe, America, Japan and India. Among these products, the output volume of Calcined Bauxite and Brown Fused Alumina both are No. 1 in the world.
Aluminum ingot price up in 2010 but alumina market still weak
----Interview with Quan Pengcheng, director of alumina supply department, Bosai Minerals Group Co., Ltd.
Asian Metal: Thanks for your coming for this interview. The economy recovered gradually in China from early this year and some economists believed that the GDP growth rate will surely reach 8% in 2009. So, Mr Quan, how do you think of the economic development in China?
Mr Quan: Exactly, the overall economy turned better in the past few months in China. I think it should be attributed to the macro-economic policies of the Chinese government, like positive fiscal and loose monetary policies. However, the domestic demand remains weak, the economy is not stable. The recovering economy may hard to sustain.
Asian Metal: Do you think the economy will touch bottom again?
Mr Quan: I think it depends on the world economy. If other nations in the world can have a good situation, it will be helpful for China. Also, it relies on beneficial policies, without which, the economy development in China may lose firm support.
Asian Metal: During the past two quarters, the alumina market went up gradually in China and the producers could not suffer losses again. The prevailing alumina price went up to RMB2,600-2,700/t. What do you think are the main reasons for the rising price?
Mr Quan: The demand and supply relations. From the statistics, we learned that the aluminum ingot producers resumed production quickly, but the alumina output expansion progressed slowly. Also, due to the heavy snow some alumina producers reduced production in recent weeks, leading to the firm price at present.
Asian Metal: How long will the price maintain?
Mr Quan: Optimistically, I think the price may last to the Spring Festival.
Asian Metal: How about the market after the Spring Festival?
Mr Quan: I think it should be difficult. Although the alumina price keeps firm at present, it may not be like this after winter. In addition, the production cost may rise after China raises the power charge.
Asian Metal: From the statistics of National Bureau of Statistics of China, the alumina output rose by about 9.3% to 2.417 million tons in October. Will the output rise continuously in the following months?
Mr Quan: I think most suspended alumina production has been resumed. The alumina price may drop to below RMB2,000/t again, if the supply becomes surplus seriously.
Asian Metal: China produced about 24 million tons of alumina in total in 2008. Do you think the output can reach the level this year?
Mr Quan: I think the output may slide down a bit this year, as most producers who cut down production last year did not resume production until the second quarter this year. The aluminum ingot output may also reduce this year.
Asian Metal: With the rising alumina output, how do you think of the alumina supply in the following year?
Mr Quan: I think the alumina supply will become surplus next year, if most producers continue to increase production. By compassion, the aluminum ingot market may go up further.
Asian Metal: How about the situation in our plant?
Mr Quan: We now can produce about 20,000t of alumina per month, based on the capacity of 200,000tpy, all of which are used by Sichuan Aba Aluminum Ingot Plant, one of our branches.
Asian Metal: As I know, your plant has an alumina expansion project. Would you please tell us something about it?
Mr Quan: Ok. The project has a designed capacity of 300,000tpy and may come on stream next April and we may consider selling some material from next May or June.
Asian Metal: You just referred to Aba Aluminum. When did the plant begin to resume production after the earthquake last year?
Mr Quan: From last December. The plant is running fully at the capacity of 110,000tpy. In addition, an expansion project of aluminum ingot with a capacity of 90,000tpy may be put into production after the alumina project with a capacity of 300,000tpy.
Asian Metal: The aluminum ingot price keeps at RMB15,000/t at present. Will that get support?
Mr Quan: I think the rising aluminum ingot price is mainly attributed to the depreciating US dollars. Therefore, it may be hard for the price to last till the New Year’s holiday. Winter is usually the slack season for aluminum consumption, and the invisible aluminum ingot stocks are sufficient at present.
Asian Metal: With the rebounding economy, do you think the demand for downstream aluminum products has rebounded?
Mr Quan: Exactly, the overall economy turned better in the past few months in China. I think it should be attributed to the macro-economic policies of the Chinese government, like positive fiscal and loose monetary policies. However, the domestic demand remains weak, the economy is not stable. The recovering economy may hard to sustain.
Asian Metal: Do you think the economy will touch bottom again?
Mr Quan: I think it depends on the world economy. If other nations in the world can have a good situation, it will be helpful for China. Also, it relies on beneficial policies, without which, the economy development in China may lose firm support.
Asian Metal: During the past two quarters, the alumina market went up gradually in China and the producers could not suffer losses again. The prevailing alumina price went up to RMB2,600-2,700/t. What do you think are the main reasons for the rising price?
Mr Quan: The demand and supply relations. From the statistics, we learned that the aluminum ingot producers resumed production quickly, but the alumina output expansion progressed slowly. Also, due to the heavy snow some alumina producers reduced production in recent weeks, leading to the firm price at present.
Asian Metal: How long will the price maintain?
Mr Quan: Optimistically, I think the price may last to the Spring Festival.
Asian Metal: How about the market after the Spring Festival?
Mr Quan: I think it should be difficult. Although the alumina price keeps firm at present, it may not be like this after winter. In addition, the production cost may rise after China raises the power charge.
Asian Metal: From the statistics of National Bureau of Statistics of China, the alumina output rose by about 9.3% to 2.417 million tons in October. Will the output rise continuously in the following months?
Mr Quan: I think most suspended alumina production has been resumed. The alumina price may drop to below RMB2,000/t again, if the supply becomes surplus seriously.
Asian Metal: China produced about 24 million tons of alumina in total in 2008. Do you think the output can reach the level this year?
Mr Quan: I think the output may slide down a bit this year, as most producers who cut down production last year did not resume production until the second quarter this year. The aluminum ingot output may also reduce this year.
Asian Metal: With the rising alumina output, how do you think of the alumina supply in the following year?
Mr Quan: I think the alumina supply will become surplus next year, if most producers continue to increase production. By compassion, the aluminum ingot market may go up further.
Asian Metal: How about the situation in our plant?
Mr Quan: We now can produce about 20,000t of alumina per month, based on the capacity of 200,000tpy, all of which are used by Sichuan Aba Aluminum Ingot Plant, one of our branches.
Asian Metal: As I know, your plant has an alumina expansion project. Would you please tell us something about it?
Mr Quan: Ok. The project has a designed capacity of 300,000tpy and may come on stream next April and we may consider selling some material from next May or June.
Asian Metal: You just referred to Aba Aluminum. When did the plant begin to resume production after the earthquake last year?
Mr Quan: From last December. The plant is running fully at the capacity of 110,000tpy. In addition, an expansion project of aluminum ingot with a capacity of 90,000tpy may be put into production after the alumina project with a capacity of 300,000tpy.
Asian Metal: The aluminum ingot price keeps at RMB15,000/t at present. Will that get support?
Mr Quan: I think the rising aluminum ingot price is mainly attributed to the depreciating US dollars. Therefore, it may be hard for the price to last till the New Year’s holiday. Winter is usually the slack season for aluminum consumption, and the invisible aluminum ingot stocks are sufficient at present.
Asian Metal: With the rebounding economy, do you think the demand for downstream aluminum products has rebounded?