Demand for chrome metal to recover in Q4 2020

Asian Metal: Hi Mr. Ma, thank you for accepting our interview. Please introduce your company briefly.

Mr. Ma: Sichuan Minghong Hengjin Technology Co., Ltd., located in Mianyang city, is a scientific and technological company specializing in the field of chrome new materials. Relying on Sichuan Yinhe Chemical's resource integration capability for key projects of 863 Program (National High Technology Research and Development Program of China), its research and development capacity of national enterprise technology center, CNAS/CMA certification and testing platform, industrial supporting facilities and environmental protection compatibility advantages, our company has capacities of 10,000tpy of chrome metal and 10,000tpy of chromium(III) oxide.

Asian Metal: What are your main products and their applications?

Mr. Ma: Our main products include chrome metal prepared via aluminothermic reaction, high-purity chrome metal, chromium(III) oxide, pink fused alumina. They are widely applied in the fields such as aerospace, military industry, nuclear industry, high temperature special alloy, chemical industry, high-end refractory material, etc.

Asian Metal: How did the COVID-19 pandemic hit your business? What did you do to solve the problem?

Mr. Ma: The logistics were almost in stagnation impacted by the COVID-19 outbreak, which greatly affected the transportation of raw material and our products. As a result, we saw tight supply of raw material and stockpiles of products.

In view of this situation, our company strictly implemented prevention and control measures, and actively organized the resumption of work and production with local policy support. We were able to maintain steady production of chromium salt by minimizing the impact from the pandemic. Our company has a logistics team, which ensured the supply of production necessities and meanwhile undertook the task of goods transportation to Wuhan.

Asian Metal: How about the demand for chrome metal and influential factors?

Asian Metal: Compared with last year, the current chrome metal market witnesses weak demand on the whole. At present, domestic demand for chrome metal is relatively stable with domestic companies resuming work rapidly. However, the export market of the metal runs slowly with demand shrinking a lot as the international market has been battered by the pandemic and some end users suspended or cut production.

Asian Metal: How do you think of the market trend of chromium salt and chrome metal in the second half of 2020?

Mr. Ma: Although participants gradually resumed work or production in the international market, the demand is unlikely to improve as the pandemic prevention and control situation is not optimistic. Chrome ore and ferrochrome prices showed an upward trend recently, but domestic chromium salt enterprises have sufficient stocks of chrome ore, so the price rise has little impact on them. It is expected that chromium salt and chrome metal markets would keep running weakly in the second half of 2020.

Asian Metal: When do you think the demand for chromium salt and chrome metal would increase?

Mr. Ma: Over the years, domestic chromium salt enterprises gradually set feet in the field of chrome metal, raising the correlation of the two materials, and thus the supply of chrome metal increased. In addition, overseas demand for chromium salt and chrome metal is weak. Therefore, the chromium salt and metal markets are unlikely to recover in the short term. In the long run, the impact of COVID-19 on the international market will gradually decrease, so the end demand will gradually pick up in the second half of this year. In addition, the price rise of chrome ore will also help the industry to recover. It is expected that the demand will improve in the fourth quarter of this year and return to the pre-pandemic level in the first half of next year.

Asian Metal: Please say something about your company's development plan and goal.

Mr. Ma: In the future, relying on Sichuan Yinhe Chemical's national enterprise technology center, CNAS/CMA certification and testing platform as well as its technological advantages in the production of chromium salt, our company will take the market reform as an opportunity and follow the developing trend of aerospace, high temperature alloy and other new materials. We will increase research investment and talents introduction, enrich product chains, improve resource utilization and explore the diversification, high value and clean production way for chrome metal. We will improve our product quality to reach the international advanced level.

Asian Metal: Thanks for accepting our interview again. May your company prosperous!

Mr. Ma: Thank you.