Executive Interviews

Asian Metal: Welcome to our interview, Mr. Qiao. First of all, please give us an introduction to your company.

Mr. Qiao: Haiming Mining was established on November 6, 2012, with a registered capital of RMB700 million. The company operates a 675,000-square-meter processing area and an 850,000-square-meter mining concession. It is a large integrated enterprise combining magnesite mining, processing, and deep processing. To date, our total investment has reached RMB2.4 billion, and the mine holds total reserves of 42 million tonnes. We currently mine 1 million tonnes of magnesite ore annually and produce 850,000 tonnes of concentrate, 300,000 tonnes of caustic-calcined magnesia, 200,000 tonnes of high-purity magnesia, and 200,000 tonnes of fused magnesia. In high-purity magnesia production, we introduced advanced equipment and technology from Thyssenkrupp of Germany and achieved fully automated control across the entire production line. This has driven equipment upgrades in the local magnesia industry and improved working conditions. We were also among the first in the industry to achieve mass production of 98-grade high-purity magnesia. For fused magnesia production, we use high-performance electric furnaces equipped with waste heat recovery and automated control systems, which reduce operational risks and improve energy efficiency. In terms of environmental protection, we use natural gas as a clean energy source and employ high-efficiency bag filters to ensure stable compliance with emission standards.

Asian Metal: What are the core strengths of your company?

Mr. Qiao: We own a high-quality mine located in the magnesite industrial center of Pailou Town, with reserves of 42 million tonnes and an annual mining capacity of 1 million tonnes. More than 60% of the ore is above Level II, with low calcium and iron impurities. Our mining operations are contracted to a professional mining company, and we adopt underground mining techniques. We have a concentrator with an annual flotation capacity of 850,000 tonnes and a production capacity of 300,000 tonnes of caustic-calcined magnesia. Our facilities include one multiple-hearth furnace and two suspension furnaces, all fueled by natural gas, placing us at the forefront of environmental performance. The ore and concentrate used for fused magnesia production, as well as the high-purity caustic-calcined magnesia required for high-purity magnesia production, are entirely self-supplied, with a small portion also available for external sales.

Asian Metal: How has the price of high-purity magnesia MgO 97%min moved since the beginning of the year?

Mr. Qiao: As of the end of October, due to sluggish downstream demand, the price of high-purity magnesia MgO 97%min has shown a gradual downward trend—falling from RMB2,250/t D/A 180 Days or RMB2,200/t D/P in early 2024 to around RMB2,150/t D/A 180 Days or RMB2,100/t D/P at present. Current prices are essentially at the cost line for most producers.

Asian Metal: What is the current demand situation for high-purity magnesia, and what are your expectations for the fourth quarter?

Mr. Qiao: In the first three quarters, China’s crude steel output fell 2.9% year-on-year, cement output dropped 5.2%, and flat glass output decreased 15.28%. Under such conditions, the refractory market is unlikely to see any improvement in the fourth quarter and may even weaken further.

Asian Metal: Liaoning Province is promoting capacity reduction in the magnesite industry. What impact will this have on the magnesia sector?

Mr. Qiao: Overcapacity has been a longstanding issue in Liaoning’s magnesite industry. Capacity reduction is therefore an inevitable step. Its purpose is to optimize the industry structure, eliminate outdated capacity, retain high-quality capacity, and increase capacity concentration. This will improve the supply side’s bargaining power in the market, allow enterprises to obtain reasonable profit margins, and ultimately promote healthy and sustainable industry development.

Asian Metal: What is your outlook for high-purity magnesia (MgO 97% min) prices in the fourth quarter?

Mr. Qiao: I hold a bullish view for three main reasons. Firstly, current prices have already reached the industry’s cost line and have limited room to fall. Secondly, many mining licenses will expire by the end of the year, tightening ore supply and possibly pushing ore prices higher in the second half. Finally, according to relevant industrial policies, all reverberatory kilns used for caustic-calcined magnesia must be eliminated by year-end, which will drive up CCM prices and subsequently lift high-purity magnesia prices. Overall, I expect high-purity magnesia (MgO 97% min) to rise by RMB100–150/t in Q4, reaching RMB2,200–2,250/t.

Asian Metal: With industry competition intensifying and profit margins being squeezed, how should producers respond?

Mr. Qiao: High-purity magnesia has broad applications—not only in the steel industry but also in cement, glass, and non-ferrous sectors. Although demand is weak, the metallurgical industry cannot operate without refractory materials. To cope with the current challenges, producers should understand customer needs more deeply and improve product quality and service. Besides, producers should cooperate with downstream users to develop new high-purity and fused magnesia products, creating differentiation and avoiding homogeneous competition.

Asian Metal: What is your view of the industry outlook over the next two to three years?

Mr. Qiao: Given that major downstream sectors—steel, cement, and glass—are all undergoing capacity reduction, the next two to three years will be a tough period for the refractory industry. Demand will continue to shrink, forcing the supply side to undergo capacity reductions as well. Some enterprises will inevitably exit the market, while others with stronger resources, technology, and management capabilities will emerge more competitive.

Asian Metal: What are the company’s development plans going forward?

Mr. Qiao: Our strategy is to remain stable while making steady progress. High-purity magnesia is our flagship product. The production of concentrate and caustic-calcined magnesia is mainly to support high-purity magnesia production, with a small portion sold externally. We will continue working to maintain and further expand our market share in high-purity magnesia. This year, we upgraded four electric furnaces that use our own ore as raw material. They were commissioned in March, and the resulting fused magnesia products will soon enter the market. If market feedback is positive, we plan to continue upgrading our electric arc furnaces and further increase fused magnesia production capacity.