Metalink: From refractory metal to super-alloy industry chain progress road

Asian Metal: Hi Mr. Ma, could you please introduce your company in brief?

Mr. Ma: Jiangsu New Resource Material Technology Co. Ltd and Nanjing New Material International Metal Co., Ltd began to produce and trade with refractory metal- based alloy and pure metal material products since the middle of 1990s. Metalink Special Alloys Corp. was set up in 2007 and undertakes the important task of further development of the two companies. As one of the national high and new technology enterprise, we mainly focus on the development, production and sales of rare refractory metals and their high-end special alloy materials. Our plant mainly focuses on refractory metal field since 1993 with the experience and technical research and development ability of the whole industry chain of rare refractory metals and alloy materials. The company currently has 33 national patents, including 16 invention patents. We continue to invest in research and development and have made many important scientific research achievements.

Asian Metal: What are your main products? How about the application areas and prospects of each material? Which areas would be the focus of future development?

Mr. Ma: With the help of more than 20 years of technical experience, our company's main products cover the whole industrial chain from mineral processing to special intermediate alloys, high purity rare metals to high-temperature alloy production. Our main products are special intermediate alloy, high purity compound, high purity elemental metal, high temperature alloy (super-alloy) as the representative of the special rare metal alloy materials and so on. Intermediate alloy and high purity metal are mainly used in downstream super-alloy, special alloy materials in aerospace field, smelting and casting alloy of special steel, etc. Super-alloys are mainly used in engines and gas turbines in aviation, aerospace, navigation and energy industries, as well as in other fields such as automobiles and special equipments. China's aviation and aerospace and other high-end sectors are in rapid development, the future growth potential and development space is large. In the field of special alloy new materials in these fields, we need to continue to carry out scientific research, and to solve the technical bottleneck, we need to stick to the spirit of running marathon for a long time.

Asian Metal: Why did ferroniobium prices keep going up while since last Q4? What about the market in H2, 2019?

Mr. Ma: In late September and October, 2018, dampened by higher vanadium nitrogen alloy prices, many steel mills chose to purchase ferroniobium to replace partial vanadium nitrogen alloy. At the same time, many vanadium traders invested more money on ferroniobium market to avoid the high risk of increasing vanadium prices, which led to the shortage in the domestic ferroniobium spot market. However, the vanadium nitrogen alloy prices decreased again in early November,2018 and decreased by around 50% until late December. As a result, the ferroniobium market began to remain stagnant in late November with decreasing prices. In early 2019, the vanadium nitrogen alloy prices reached the bottom periodically and the supply of Brazilian ferroniobium became enough again. Vanadium and niobium prices also slowly formed a situation of mutual restraint. During this period, the significant impact of the new steel standards cannot be ignored.

On the other hand, the trading conflict between China and the USA also dampened tantalum and niobium prices as the USA increased the tariff for Chinese goods in 1st September, 1st October and 15th December last year. The changes of policy brought the changes of demand. For most Chinese domestic tantalum and niobium companies, the export market could not support the prices any more. For most niobium smelters in China, some domestic ferroniobium producers would consume part of niobium oxide. However, some steel mills whose impurity content requirement is not very high also begin to use imported ferroniobium to replace domestic ferroniobium due to the development of production technology. As the quantity, production cost and sales price for imported ferroniobium remain stable, large amount of niobium oxide could not be consumed by domestic ferroniobium producers, which is one of the main reasons for decreasing niobium prices.

We predict that the niobium prices would remain at a low level in Q4, 2019 due to the poor demand from end users. Tantalite prices would increase according to the limited supply from African market and the alternative mineral product price fluctuation brings the effect of conversion under comparative benefit. In addition, many Chinese smelters would come back to the market and make more purchases for the future production, which would support tantalite prices hovering at prices higher than USD50/lb Ta2O5.

Asian Metal: What is the current production and consumption situation for Chinese ferroniobium?

Mr. Ma: Our New Resource Company used to consume African calcite to produce ferroniobium while now mainly consume niobium oxide as raw materials. Brazilian ferroniobium is directly produced by calcite from its own mines, so the production cost is much lower than Chinese materials. However, the quality of Chinese ferroniobium is better than Brazilian materials. At the same time, as current vanadium prices remain at a low level, niobium prices have no advantages any more for most downstream rebar mills. As the research statistics from CITIC Metal, the world average consumption index of iron niobium per ton of steel is 50g of niobium per ton of steel while the index in South Korea, Japan, Europe and USA is around 100g while Chinese index is only 30g. We believe that the niobium consumption volume in China would continue to increase in the future.

Asian Metal: Which areas could niobium and vanadium replace with each other? Which areas could only use ferroniobium?

Mr. Ma: As far as we know, in rebar area, vanadium and niobium could replace with each other. As niobium and vanadium are all important micro-alloyed elements, they have their own characteristics. Niobium has the strongest grain refinement and strengthening effect in steel and vanadium has the strongest precipitation strengthening effect in steel. Ferroniobium has more advantages in plate production while ferrovanadium is more widely used in strip.

Asian Metal: Does the implementation of China's new rebar standard have any substantial impact on the current ferroniobium and ferrovanadium market?

Mr. Ma: China's new standard for rebar has eliminated the third class rebar, adding the metallographic structure inspection requirements and corresponding inspection methods as the basis for determining the strength of hot-rolled steel bar (mainly by adding alloy elements) and water-penetrating steel bar (mainly by water-penetrating technology), which could effectively avoid the imitation of hot-rolled steel bar with water-penetrating steel bar. After the implementation of the new national standard, major alloy elements such as manganese, silicon, vanadium, niobium and titanium are required to be added in the production process, and the proportion of vanadium, niobium and other micro-alloy elements is increased. The increase in the amount of micro-alloying elements indicates the advanced level of steel production in a country. China's steelmaking technology improves further, which also marks that our country gradually becomes a steel power.

Asian Metal: Does the trading conflict between China and the USA dampen the normal import and export market for tantalum and niobium products? How to deal with it?

Mr. Ma: China is not the major niobium producer while Brazil is the biggest one in the world with stable supply. As a result, the trading conflict has small impact on niobium supply and demand. It is worth considering whether the geopolitical changes in the future will make our country rely heavily on Brazilian niobium resources. In the aspect of tantalum, China is also heavily dependent on imported raw materials, which is determined by the characteristics of tantalum niobium resource endowment in China. At the same time, our tantalum products also rely heavily on export market. Since the major tantalum users in the United States have applied for exemption of tantalum products imported from China, they are not included in the scope of trump's retaliatory tariffs, which gives us a certain amount of time to deal with the tantalum industry. In fact, China has an industrial chain advantage in tantalum-niobium metallurgy and is also the largest importer of tantalum-niobium raw materials. How to increase the development and expansion of tantalum niobium application in China becomes a necessity for the healthy development of tantalum niobium industry. Our company has been trying to use more domestic tantalum niobium metal to develop its own high temperature alloy products.

Asian Metal: What is the future plan for the development of your company? Which products would you focus on?

Mr. Ma: Our company would not get involved in tantalum-niobium hydrometallurgy in the future, and would focus on tantalum-niobium application development, mainly developing new materials of special rare metal alloy represented by super-alloy. Up to now, our company has developed and produced more than 50 brands of special super-alloy products including single crystal, directional crystal and equiaxial crystal, which are applied in aviation, aerospace and navigation fields. In the future, we will still focus on development and expect to gradually form technological advantages. We have a history of 26 years. Over the years, thanks to peer support and customer trust, we have accumulated some technology and knowledge in the field of refractory metals. However, there will always be challenges on the way of development. Therefore, we will further carry out in-depth cooperation in scientific research and management with friends in the industry and downstream customers. In particular, we will do a good job in in-depth scientific research and development of refractory metal application, and work together to improve the technology level of refractory metal application in the downstream high-end special alloy field. Thanks again for your concern and support!