12th Rare Earth Summit

May 27-28, 2021
Hangzhou, Zhejiang, China

11th Aluminum Raw Materials Summit

May 20-21, 2021
Hangzhou, Zhejiang, China

9th Magnesium Summit

April 15-16, 2021
Hangzhou, Zhejiang, China

13th World InBiGeGa Forum

March 25-26, 2021
Hangzhou, Zhejiang, China

7th World Antimony Forum

June 13-14, 2019
Changsha, Hunan, China

7th Refractory & Abrasive Materials Summit 2019

May 23-24, 2019
Qingdao, Shandong, China

10th Aluminum Raw Materials Summit

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

6th World Manganese & Selenium Forum

May 21-22, 2018
Hainan Sanya, China

Interview with Li Huanxin, General Manager of Huakun Metal Material (Shanghai) Co.,Ltd.

Established in 2009, Huankun Metal is a Chinese-foreign joint venture integrated with Shanghai Zhuodai Industrial and Trading Company, Hunan Huitianran and other operations. With annual production capacity of 60, 000t, the company is mainly engaged in the domestic and foreign trade of ferroalloy, steel products and coal as well as the production of manganese ingot and manganese briquette. The company has annual sales revenue of RMB1 billion more or less.
Huakun Metal continues to explore the domestic and foreign markets in accordance with the concept of “Creating value for customers and future for itself”. Currently, the main markets of ferroalloy are POSCO, HYSCO, XISC, ZPSS as well as other domestic and foreign iron and steel enterprises.
Li Huanxin: On the Debate of Manganese Briquette Duty and the Thoughts of Manganese Flake Industrial Development
----Interview with Li Huanxin, General Manager of Huakun Metal Material (Shanghai) Co.,Ltd.
Asian Metal: First of all, I am grateful for General Manager Li accepting the interview. Please introduce manganese briquettes and manganese flake export duty firstly.
Li: Currently, Chinese unwrought manganese and its scrap export are charged 20% of taxes, while the wrought manganese and its products are not charged taxes. The debate on the manganese briquette taxes is one of the hot points of electrolytic manganese. Some employees of the electrolytic manganese industry and even the website media thought that wrought manganese and its products exported without taxes is an obstacle for the development of electrolytic manganese industry.
Asian Metal: So considering the debate on the manganese flake industry, please talk about the reasons causing this export taxes policy differentiation?
Li: Firstly, I will analyze the unbalance problem of export taxes relying on other industries’ conditions, such as in the iron and steel industry, the export taxes differentiation condition of ordinary steel and other low-end products. The normal export taxes of the ordinary steel is 15-30%, while the export rebate rate of other alloy steel is 9%. Through adding boron 0.0008%, titanium 0.05% and other trace alloys, the alloy steel’s properties are not changed, while these trace alloys will negatively affect some steels. However, the boron steel means an increase of nearly RMB100/t for costs. Exported in the name of other alloy steels, the export taxes gap of the ordinary steel amounts to 24%. Another HS code of the steel export is coating products. Through coated paint, the steel plates can get 13% of rebate tax, a gap of 28% compared with the taxes of ordinary steel. In recent years, the export volume of other alloy steels added boron as well as the costing products gradually takes up around 70% of the steel export volume. That is a kind of transition policy and assistance of our country to the development of steel industry, while its aim is that as the country encourages the steel industry to improve the technological content, it retains the international price competitiveness for the low-end steel producers and makes they not close down completely due to losses of market share. As for the export taxes differentiation, personally, I think that our country is in line with my view.
Asian Metal: If manganese briquette taxes are increased, the development of the manganese industry will fluctuate. What changes do you think will happen in the export?
Li: If manganese briquette taxes sharply increase by 20%, the other overseas steel mills will also use the substitutes of manganese. Manganese briquette is exported and the electrolytic market exists with higher manganese briquette taxes, while manganese briquette cannot be exported and can the export of electrolytic manganese return to the start? The sharp increase of manganese briquette taxes can only cause severer smuggles or the substitute products of manganese.
Asian Metal: What do you think of the relations of manganese briquette and wrought manganese products?
Li: What is the meaning of products? They are products without any changes of physical properties ruled by the textbook. The majority of steel products and metal products all have experienced the changed of physical properties and are affirmed as products. Why do the meaningless definitions from other industries suffer misunderstandings in the manganese industry? Extremely, do the products manufactured in the automobile assembly lines have changes of chemical properties? The manganese briquette does not just involve in the changes of physical property. Through physical properties and processing technology improvement, manganese briquette and other products can save energy and improve the using effect, while they can reduce the user cost, so I think they belong to manganese products. The personages of the industry should be positive to fight for the time and space of industrial development, while to make best use of the time and space left by our country and the government.
Asian Metal: What is your point of the taxes problem of manganese products?
Li: Personally, the previous wrought manganese and its products exported without taxes is a transition and protection measure of our country towards the domestic electrolytic manganese industry, whose aim is to guard the whole electrolytic manganese market against too big contraction and avoid the excessive impact on the domestic seriously excessive and disorderly competitive electrolytic manganese industry. The export and smuggle of manganese briquette are two completely different concepts. It is reasonable to reduce the products export volume of high consumption of energy, while the regulation should be step by step. Most of our country’s policies all abide by that principal and the industries should also strive for those time and space to adjust and develop further.
Asian Metal: Korea is the largest purchaser of manganese briquette, while your company is also a major supplier. In your opinion, currently, do Korean buyers have plans to adjust the purchasing of manganese briquette?
Li: Reducing purchase costs is a common measure of all the steel enterprises in the whole world. If manganese briquette is charged 20% of taxes, the purchase costs of the overseas steel enterprises will sharply increase and inevitably they will buy manganese-based alloy as its substitutes. As the biggest manganese briquette consumer, influenced by Chinese expectation of increase manganese briquette taxes, POSCO devotes itself to the implement of insignificant carbon manganese iron substitution measures. Its insignificant carbon manganese iron production lines are expected to come into operation in the first half of next year. By then, the export of manganese briquette will be largely influenced.
Asian Metal: Referring to energy conservation and cost reduction, please talk about what are the advantages of the manganese products compared with other manganese-based products.
Li: As a part of the electrolytic manganese industry, manganese briquette is a deep processing product of electrolytic manganese, the same as manganese ingot. In person, I am not for the view of some insiders’ understanding of the manganese briquette products. Compared with manganese ingot, the production technology of the manganese briquette products is more advanced, which can substantially reduce energy consumption in accordance with national energy conservation and environmental protection policy, while without environmental pollution, it is appropriate for the steel mills. As for the using effect for the steel mills, manganese briquette is more effective than manganese ingot. Manganese ingot is smelted using intermediate frequency furnaces and the power consumption amounts to 600KW per ton, while manganese briquette mould by cold compression and has significant energy conservation effect with power consumption of less than 100 KW per ton. Currently, in China, Baosteel, Wugang and other large electrolytic users have already used manganese briquette to replace manganese ingot to reduce costs. Compared with manganese slice, the manganese briquette products do not need special feeding devices when used in the steel mills, and with high manganese recovery rate it can help the steel mills to reduce costs.
Asian Metal: In your opinion, how do insiders strive to make the electrolytic manganese industry develop orderly?
Li: Chinese electrolytic manganese production capacity has already seriously oversupplied. The phenomenon of disorder mining of manganese carbonate and disorder competitiveness of industries have existed in the long term. The government is taking powerful measures to reorganize and programme the orderly exploration and utilization of resources. The electrolytic manganese industry is just a small part of the manganese industry. As technology progresses, the development space of the electrolytic manganese industry is very limited. Once electrolytic manganese is replaced by other manganese products, it will die away without competitiveness. As a member of the industry, we should be positive to support and cooperate with the government, using the limited time and space to become strong from technology, scale, cost control, environmental protection, safety as well as other aspects and to strive for the time and space for the industry to development.
Asian Metal: I believe that Chinese manganese industry will have a healthy and orderly development under our joint effort. Thanks again for General Manager Li’ support to Asian Metal.
Li: I also wish that Asian Metal becomes more authoritative and orientative in both domestic and overseas markets. Thanks!