The Logicality Of Raw Material Price Rising

- Sep 28, 2018-

Raw material supply and market price performance are once again the leading topics of conversation among delegates at the 61st International Colloquium on Refractories this week in Aachen, Germany.

Considering the restrictions on mining and production operations in China - the largest producer of several key refractory raw materials such as bauxite, fused alumina, magnesia, and graphite - attendees in Aachen are assessing what the future holds for supply.

"It’s the second year in a row that we've talked about, essentially, only raw materials," one user said on the sidelines of the event. "If it’s not about bauxite, it’s about magnesia or it’s about alumina. But there is no running away from it."

Indeed, you have to take whatever it comes.

However, if you look at what has happened in China, there always be a push to the continuous evolvement.

Since last year, China has begun to show a firm stance in environmental protection, it legalized the environmental tax, to punish carbon emission and pollutant, it obsoleted out-dated productivity to promote an upgrade, those measures brought in extra cost and cut away some capacity and competition.

Degradation of mines. China used to have the best bauxite for abrasive and refractory, however, after years' excessive extraction, high-grade ores are on the brink of exhaustion, abrasive grade bauxites are costing more and more fuel or energy.

An escalating cost of the human resource. No need to mention, it is applying in every business sector.

Almost every factor related to the refractory industry and the abrasive industry gets unfavorable to downstream, inevitably, most of all incremental-cost will be passed down.

That's the how the price formed presently.