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May 27-28, 2021
Hangzhou, Zhejiang, China
11th Aluminum Raw Materials Summit
May 20-21, 2021
Hangzhou, Zhejiang, China
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Hangzhou, Zhejiang, China
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March 25-26, 2021
Hangzhou, Zhejiang, China
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Changsha, Hunan, China
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May 23-24, 2019
Qingdao, Shandong, China
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May 16-17, 2019
Zhengzhou, Henan, China
11th Rare Earth Summit
May 9-10, 2019
Qingdao, Shandong, China
8th Magnesium Summit
April 11-12, 2019
Zhuhai, Guangdong, China
12th World InBiGeGa Forum
March 14-15, 2019
Zhuhai, Guangdong, China
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May 21-22, 2018
Hainan Sanya, China
Interview with Khulan, International sales department minister of Mongolian Altain Khuder LLC.,
Altain Khuder LLC., founded in 2008, is a private enterprise of sole proprietorship in Mongolia, focusing on mining and exploring. At present, Altay is mining and producing high quality granularity fines 60%min with fewer harmful factors in Dayannaoer iron mine, Chele County, Govialtay. Export volume of iron ore fines amounted 4% of the total figure in Mongolia in 2009, while the figure increased to 9% and 24% respectively in 2010 and 2011, making the enterprise out to be the largest iron ore fines exporter in Mongolia. The enterprise, relying on the excellent geographic location and high quality products, devotes itself to meet the demand for raw materials during the rapid developments of Northwest China. So far, the enterprise has built cooperative relationships with mills in Urumqi Municipality, Kumul, Korla, Kuytun, as well as Baotou in Inner Mongolia.
Khulan: Iron ore potential market Northwest China is tremendous
----Interview with Khulan, International sales department minister of Mongolian Altain Khuder LLC.,
Asian Metal: Thanks a lot for accepting our interview. Firstly, please introduce Altain Khuder LLC. And the basic conditions of the company.
Altain Khuder: Altain Khuder LLC., which was registered as a sole proprietorship in Mongolia in 2008, is located in Tayan Nuur, GoviAltai, which is in the southwest of Mongolia. The company produces over 60% of s iron ore with dry separation in opencast working, and the iron ore fines with high quality is supplied to steel mills in Xinjiang and Gangsu in Northwest China.
The Tayan Nuur mine is located closer to the Mongolian-Chinese border than any other iron ore mine in Mongolia, situated approximately 168 kilometers from the border. We transport the iron ore fines to New Burgos port in Mongolia and inventory of China customs in Santanghu, Kumul, Xinjiang with our own trucks. The mine possesses significant and strategic location for steel mills in Northwest China as the area is landlocked, and it is difficult for overseas suppliers to ship iron ore fines, thus the Tayan Nuur mine is the only nearest supplier for mills in Northwest China. Mills in southwest China imported iron ore fines from Kazakhstan iron ore mine, which was 2,000km away from the border of the two countries as we had not imported iron ore fines before 2009. After entering the market, export volume of our company influenced the volume of Kazakhstan iron ore mine directly. According to data released by China Customs, China imported 6.1 million tons of iron ore fines from Kazakhstan in 2010, while the volume decreased to 4.3 million tons in 2011. Altain Khuder exported 315,000 tons and 4.3 million tons of iron ore fines in 2010 and 2011 respectively. Our company has become the second largest suppliers with diversification of iron ore fines and raw materials for Southwest China. Altain Khuder is optimistic about the market as the country announced plans of development and investment of Northwest China as well as development of steel industry in the period of the “Twelfth Five Year”. The economic development influenced demand for steel. According to the twelfth five-year plan, the output of steel is 9.5 million tons in Xinjiang, and the output is anticipated to reach to 39.70 million tons in 2015. Hence, demand for iron ore fines will increase continually in the next few years.
Asian Metal: Could you please introduce the output and the development plan in the future?
Altain Khuder: The Tayan Nuur mine is the second largest iron ore mines in Mongolia. If the company supplies 10 million tons of iron ore fines for mills in Northwest China per year, the mine can operate for thirty years. Export volume rises with expanded process scale from time to time. The company exported 55,000 tons of iron ore fines in 2009, 315,000 tons in 2010 and over 1.3 million tons in 2011, and the volume of 2011 accounted for 24% of the total export volume. Altain Khuder is not only a large exporter in Mongolia, but also a main regional exporter. The company plans to supply 2.3 million tons of iron ore fines in 2012, four million tons in 2013, five million tons in 2014 and five million tons of dry separation iron ore fines in 2015 to all steel mills in Northwest China. Moreover, Altain Khuder decided to build a wet separation with two million tons in Q3, 2013, and it will supply products with high additional value such as pellet, pig iron and direct reduced iron to Chinese market.
Asian Metal：How does your company see the development of steel industry in West China? What features does the market have? What sales strategies do you have for this market?
Altain Khuder: The iron ore fines market in northwest China is quite different from that in coastal area in China. For instance, the area is an inland province which fact causes restrictions for international suppliers to supply raw material. The northwest market could only import iron ore fines from Kazakhstan by 2009. Meanwhile, transportation cost is high in this area where infrastructure and railway construction lags far behind those in Chinese mainland. Local mid-and-small sized steel mills lack iron ore fines suppliers as very few large steel mills in this area hold most shares of local large iron ore mines. The level of trading methods, open degree and financial derivatives in northwest market of iron ore fines lags behind those in mainland. Market in northwest China is also less competitive in fields and the pricing power is in the hand of steel mills only. However, I believed that all the above shortages in this area would be improved. Considering the features of the market, our company sets down sales strategies as follows: Altain Khuder LLC., supports private and mid-and-small-sized steel mills with various price policies according to the distance between our company to steel mills. Iron ore fines would be delivered to steel mills by trading companies though cooperation. Our company aims at establishing a win-win relationship with our partners. Therefore, the fields our company’s sale strategy focuses on, logistic companies, trading companies and banks have a great effect on the development of the market as well as markets in mainland. I think that they earn more money as they devote to the new market. So I invite all enterprises who want to establish a partnership with us with pure-heartedness, to attend the summit forum of demand and supply for iron ore in northwest China in search of new opportunities and long-term partnership.
Asian Metal: what problems do you think the sales policy bring? What about opportunities?
Altain Khuder: I mentioned features in Northwest China and there are both challenges and opportunities for us to export iron ore fines. We faced following issues on the export of iron ore fines:
Firstly, We have difficulty in making business with large mills as they cooperate together in order to force our company to lower the price of products. Furthermore, they even took some measures to keep small and medium mills from the market.
Secondly, Xinjiang-based Laoyemiao port is located in a nonstandard position of Santanghu County of Hami, 84km away from Chinese border, which increases the transportation cost. Our company has to pay up to RMB37/t of warehouse supervision fee as only one Customs warehouse at Chinese ports. Meanwhile the port is only available bi-monthly to restrict the movement. The movement of materials at Laoyemiao port ranks the third place in Xinjiang. Hence, our company hopes that Hami government could pay more attention on the development of the port and provide more warehouses to companies to support our company as well as other small-medium companies. To expand the capacity and make the port be available all the year round is necessary as our company increases the production of iron ore fines.
Thirdly, the load capacity is limited as the asphalt road, stretching 84km between Laoyemiao port and Santanghu County is not suitable for heavy load. The limitation increases the transportation cost. Meanwhile, the transportation cost in Xinjiang is 1-2 times higher than that in Chinese mainland. If rail way is built from Santanghu to Urumchi and Gansu, the cost will be lower. Therefore, our company hoped that Chinese government will attach importance on the railway contraction during twelfth Five-year plan in Northwest China.
Asian Metal: Many Chinese enterprises invest on steel industry in Northwest China. Does your company have such kind of plan?
Altain Khuder: Altain Khuder LLC., produces high quality iron ore fines and exports the material to Northwest China. We plan to produce finished products in Xinjiang as we are rich of raw material and China has strong real demand. Our company plan to build pellet plant, iron ore plant and direct reduced iron plant near Santanghu port of Hami and we have made contact with companies at home and abroad to talk about investment and cooperation.
Asian Metal: What do you think of the western iron ore fines market during this quarter or H1?
Altain Khuder: The market is active in Xinjiang from April to October with high prices for the reasons as follows: Firstly, it turns warm in Northwest China and some construction projects are started. With stronger demand for steel, the price will begin to rise. Secondly, most newly built or expanded plants will go into production in the end of the year, so the stockpile of iron ore fines should start in June to August. Meanwhile North Xinjiang will take position of iron ore fines in July to October as most iron ore mines will stop production in December to March. Thirdly, most local mines will not life output as mills in Xinjiang and Gansu can purchase cheap materials in the local market. Hence, local mills have to increase the price of iron ore fines by RMB65/t in the end of March. We expected that the growth rate of iron ore fines market in Northwest China will be slight higher than that of coastal areas.
Asian Metal: Thank you again for accepting the interview. Wish a brighter future for your company!
Altain Khuder: Thank you!
Altain Khuder: Altain Khuder LLC., which was registered as a sole proprietorship in Mongolia in 2008, is located in Tayan Nuur, GoviAltai, which is in the southwest of Mongolia. The company produces over 60% of s iron ore with dry separation in opencast working, and the iron ore fines with high quality is supplied to steel mills in Xinjiang and Gangsu in Northwest China.
The Tayan Nuur mine is located closer to the Mongolian-Chinese border than any other iron ore mine in Mongolia, situated approximately 168 kilometers from the border. We transport the iron ore fines to New Burgos port in Mongolia and inventory of China customs in Santanghu, Kumul, Xinjiang with our own trucks. The mine possesses significant and strategic location for steel mills in Northwest China as the area is landlocked, and it is difficult for overseas suppliers to ship iron ore fines, thus the Tayan Nuur mine is the only nearest supplier for mills in Northwest China. Mills in southwest China imported iron ore fines from Kazakhstan iron ore mine, which was 2,000km away from the border of the two countries as we had not imported iron ore fines before 2009. After entering the market, export volume of our company influenced the volume of Kazakhstan iron ore mine directly. According to data released by China Customs, China imported 6.1 million tons of iron ore fines from Kazakhstan in 2010, while the volume decreased to 4.3 million tons in 2011. Altain Khuder exported 315,000 tons and 4.3 million tons of iron ore fines in 2010 and 2011 respectively. Our company has become the second largest suppliers with diversification of iron ore fines and raw materials for Southwest China. Altain Khuder is optimistic about the market as the country announced plans of development and investment of Northwest China as well as development of steel industry in the period of the “Twelfth Five Year”. The economic development influenced demand for steel. According to the twelfth five-year plan, the output of steel is 9.5 million tons in Xinjiang, and the output is anticipated to reach to 39.70 million tons in 2015. Hence, demand for iron ore fines will increase continually in the next few years.
Asian Metal: Could you please introduce the output and the development plan in the future?
Altain Khuder: The Tayan Nuur mine is the second largest iron ore mines in Mongolia. If the company supplies 10 million tons of iron ore fines for mills in Northwest China per year, the mine can operate for thirty years. Export volume rises with expanded process scale from time to time. The company exported 55,000 tons of iron ore fines in 2009, 315,000 tons in 2010 and over 1.3 million tons in 2011, and the volume of 2011 accounted for 24% of the total export volume. Altain Khuder is not only a large exporter in Mongolia, but also a main regional exporter. The company plans to supply 2.3 million tons of iron ore fines in 2012, four million tons in 2013, five million tons in 2014 and five million tons of dry separation iron ore fines in 2015 to all steel mills in Northwest China. Moreover, Altain Khuder decided to build a wet separation with two million tons in Q3, 2013, and it will supply products with high additional value such as pellet, pig iron and direct reduced iron to Chinese market.
Asian Metal：How does your company see the development of steel industry in West China? What features does the market have? What sales strategies do you have for this market?
Altain Khuder: The iron ore fines market in northwest China is quite different from that in coastal area in China. For instance, the area is an inland province which fact causes restrictions for international suppliers to supply raw material. The northwest market could only import iron ore fines from Kazakhstan by 2009. Meanwhile, transportation cost is high in this area where infrastructure and railway construction lags far behind those in Chinese mainland. Local mid-and-small sized steel mills lack iron ore fines suppliers as very few large steel mills in this area hold most shares of local large iron ore mines. The level of trading methods, open degree and financial derivatives in northwest market of iron ore fines lags behind those in mainland. Market in northwest China is also less competitive in fields and the pricing power is in the hand of steel mills only. However, I believed that all the above shortages in this area would be improved. Considering the features of the market, our company sets down sales strategies as follows: Altain Khuder LLC., supports private and mid-and-small-sized steel mills with various price policies according to the distance between our company to steel mills. Iron ore fines would be delivered to steel mills by trading companies though cooperation. Our company aims at establishing a win-win relationship with our partners. Therefore, the fields our company’s sale strategy focuses on, logistic companies, trading companies and banks have a great effect on the development of the market as well as markets in mainland. I think that they earn more money as they devote to the new market. So I invite all enterprises who want to establish a partnership with us with pure-heartedness, to attend the summit forum of demand and supply for iron ore in northwest China in search of new opportunities and long-term partnership.
Asian Metal: what problems do you think the sales policy bring? What about opportunities?
Altain Khuder: I mentioned features in Northwest China and there are both challenges and opportunities for us to export iron ore fines. We faced following issues on the export of iron ore fines:
Firstly, We have difficulty in making business with large mills as they cooperate together in order to force our company to lower the price of products. Furthermore, they even took some measures to keep small and medium mills from the market.
Secondly, Xinjiang-based Laoyemiao port is located in a nonstandard position of Santanghu County of Hami, 84km away from Chinese border, which increases the transportation cost. Our company has to pay up to RMB37/t of warehouse supervision fee as only one Customs warehouse at Chinese ports. Meanwhile the port is only available bi-monthly to restrict the movement. The movement of materials at Laoyemiao port ranks the third place in Xinjiang. Hence, our company hopes that Hami government could pay more attention on the development of the port and provide more warehouses to companies to support our company as well as other small-medium companies. To expand the capacity and make the port be available all the year round is necessary as our company increases the production of iron ore fines.
Thirdly, the load capacity is limited as the asphalt road, stretching 84km between Laoyemiao port and Santanghu County is not suitable for heavy load. The limitation increases the transportation cost. Meanwhile, the transportation cost in Xinjiang is 1-2 times higher than that in Chinese mainland. If rail way is built from Santanghu to Urumchi and Gansu, the cost will be lower. Therefore, our company hoped that Chinese government will attach importance on the railway contraction during twelfth Five-year plan in Northwest China.
Asian Metal: Many Chinese enterprises invest on steel industry in Northwest China. Does your company have such kind of plan?
Altain Khuder: Altain Khuder LLC., produces high quality iron ore fines and exports the material to Northwest China. We plan to produce finished products in Xinjiang as we are rich of raw material and China has strong real demand. Our company plan to build pellet plant, iron ore plant and direct reduced iron plant near Santanghu port of Hami and we have made contact with companies at home and abroad to talk about investment and cooperation.
Asian Metal: What do you think of the western iron ore fines market during this quarter or H1?
Altain Khuder: The market is active in Xinjiang from April to October with high prices for the reasons as follows: Firstly, it turns warm in Northwest China and some construction projects are started. With stronger demand for steel, the price will begin to rise. Secondly, most newly built or expanded plants will go into production in the end of the year, so the stockpile of iron ore fines should start in June to August. Meanwhile North Xinjiang will take position of iron ore fines in July to October as most iron ore mines will stop production in December to March. Thirdly, most local mines will not life output as mills in Xinjiang and Gansu can purchase cheap materials in the local market. Hence, local mills have to increase the price of iron ore fines by RMB65/t in the end of March. We expected that the growth rate of iron ore fines market in Northwest China will be slight higher than that of coastal areas.
Asian Metal: Thank you again for accepting the interview. Wish a brighter future for your company!
Altain Khuder: Thank you!