Executive Interviews

Asian Metal: Mr. Zhao, welcome to Asian Metal’s interview. Could you please give us a brief introduction to your company?

Mr. Zhao: Henan Ant New Materials operates six manufacturing sites in Ludian Town and Gaocheng Town, Dengfeng City, with a total plant area of over 70,000 square meters and more than 200 employees. We currently operate four brown fused alumina electric arc furnaces with a combined capacity of 5,000tpm, and six white fused alumina arc furnaces with a monthly capacity of 4,500t. In addition, we have two calcined alumina production lines and three iridium-coating production lines. Abrasives account for approximately 80% of our sales, while refractory materials make up the remaining 20%. Our annual output of various alumina products totals around 70,000t. We are committed to providing cost-effective alumina products to customers in coated abrasives, vitrified grinding wheels, resin-bonded wheels, surface treatment, and refractory industries. Thanks to our strict control over raw materials and multi-layer quality control of finished products, our laboratory is equipped with spectrometers capable of testing ten samples simultaneously, laser particle size analyzers, ball milling toughness testing equipment, and other advanced inspection facilities.

Asian Metal: Since the beginning of 2025, prices of brown fused alumina abrasives have continued to decline. What are the main reasons behind this trend, and what advantages does your company have in coping with the market downturn?

Mr. Zhao: The decline in brown fused alumina prices is primarily driven by changes in supply-demand dynamics. On the demand side, since the second quarter of 2025, brown fused alumina prices have been pressured by falling white fused alumina prices, forcing most producers to cut prices to maintain sales. Currently, ex-works prices for brown fused alumina grit are around RMB5,300/t, while white fused alumina grit is priced at approximately RMB4,600/t. As a result, many downstream users have shifted to white fused alumina as a substitute, further dampening demand for brown fused alumina. On the supply side, brown fused alumina capacity in 2025 is estimated at 2.5 million tonnes, while market demand is only around 900,000t, indicating severe oversupply. To address this, the only viable solution is continuous product development. We are currently developing semi-friable alumina, while also optimizing existing equipment to improve product quality. Through automation upgrades, we aim to reduce production costs, and we will adjust operating rates in line with actual sales conditions.

Asian Metal: In recent years, both the quality and availability of domestic bauxite resources have declined. How has your company responded to this challenge?

Mr. Zhao: Since 2020, tightening supplies of high-quality bauxite have pushed prices to elevated levels, significantly increasing smelting costs for brown fused alumina and leading to losses in certain smelting operations. In response, we have adjusted our smelting processes by using blended bauxite feedstocks to reduce reliance on high-grade material. Previously, our process required bauxite with an alumina content of 85%–87%. Following process optimization, we can now partially substitute this with bauxite containing 80%–85% alumina, reducing unit costs by approximately RMB50/t.

Asian Metal: What is your outlook for supply-demand conditions and price trends in the brown fused alumina abrasives market in the first quarter of this year?

Mr. Zhao: On the supply side, electricity prices in Henan have risen sharply by RMB0.08-0.10/kWh since January, increasing smelting costs for brown fused alumina by roughly RMB180-230/t. As a result, many producers in Henan will be forced to suspend operations due to the inability to absorb such high costs, which should lead to a rebound in prices. However, production costs in regions such as Shanxi and Guizhou have not changed significantly, allowing these areas to partially offset the supply shortfall caused by Henan shutdowns. On the demand side, continued weakness in white fused alumina prices will keep brown fused alumina demand subdued, with little room for short-term improvement.

Asian Metal: How is your export business performing, and how do you plan to balance domestic and overseas sales?

Mr. Zhao: Our export ratio previously stood at around 25%, with exports of approximately 20,000t last year, accounting for one quarter of our annual output of 80,000t. However, in the second half of 2025, following the implementation of the EU’s 136% anti-dumping duties, the European market came to a complete standstill, reducing our export share to around 10%. Although the EU announced in December that it would open a quota of 30,000t for Chinese brown fused alumina, this is still negligible compared with the overall market loss. Going forward, we will focus on the domestic market, extend the industrial chain, and enhance value-added products.

Asian Metal: How is your company responding to the EU’s anti-dumping investigation and high tariffs?

Mr. Zhao: We have participated in the anti-dumping proceedings, but there is currently no clear countermeasure. Although a 30,000-tonne export quota has been introduced, it remains uncertain how much we will actually receive. In 2024, China exported approximately 120,000t of white fused alumina and 85,000t of brown fused alumina to the EU, making it the largest export destination for Chinese alumina products. With the loss of this market, we have no choice but to shift our focus to the domestic market and alternative regions such as Japan, South Korea, and Southeast Asia, where competition is inevitably more intense.

Asian Metal: How do you assess the current development of the brown fused alumina abrasives market, and where do you see potential opportunities?

Mr. Zhao: Oversupply is the most critical issue at present. Brown fused alumina capacity in 2025 is around 2.5 million tonnes, while demand is only about 900,000t. The abrasives segment accounts for roughly 30% of total demand. Moreover, the significant price gap between brown and white fused alumina has further eroded brown fused alumina’s market share. It is extremely difficult to expand new domestic demand. Opportunities may exist in Southeast Asia, the Middle East, Africa, and South America, but profitability remains uncertain. Therefore, our strategic direction is to move downstream, enhance product value through high-temperature calcination and iridium coating, and deliver higher value to customers while strengthening product competitiveness.

Asian Metal: What suggestions do you have for the long-term development of China’s alumina abrasives market?

Mr. Zhao: The imbalance between supply and demand is widely recognized across the industry. Our strategy is to continuously improve product quality and stability through equipment optimization and digital management, while further reducing costs. We are prepared for long-term operation under thin margins, a process that may take up to ten years.