Raw material prices continue to rise, refractory companies are running hard

Since the purchase price of raw materials, fuels and power has continued to rise year-on-year, the production of China's refractory industry has been in a high-cost operation since this year. In particular, the production costs of carbon-containing refractories (magnesium carbon bricks, aluminum-magnesium carbon bricks, and aluminum carbon bricks) have risen sharply, and the prices of major raw materials such as graphite, resin, and brown corundum have skyrocketed, and energy and labor costs have increased. The cost pressure of production enterprises has increased, only graphite, the raw material cost per ton of magnesia carbon bricks has increased by nearly 500 yuan, and the production of carbon-containing refractories has fallen into the quagmire of losses in the whole industry.

According to incomplete statistics, from January to September this year, the price of MS-95 mid-range magnesia rose by 4.35%, the price of DMS-97 fused magnesia rose by 8.69%, and the prices of raw materials such as graphite, resin and brown fused alumina rose sharply. Due to the sharp rise in the price of raw fuel, the cost pressure on production companies has increased. The price of graphite for carbon-containing refractories has continued to rise recently, especially since October, the price has risen sharply. Taking -197 graphite as an example, the price has risen from 3,200 yuan/ton to 5,800 yuan/ton since the beginning of the year. The proportion reached 81.25%; the price of resin has risen sharply since April, especially the price of liquid resin has entered a rapid rise since June, and the purchase price has risen from 11,000 yuan/ton at the beginning of the year to 14795 yuan/ton. Up to 34.5%; the price of brown fused alumina has risen sharply since July, and the purchase price has risen from 3,950 yuan/ton at the beginning of the year to 4,500 yuan/ton, and the increase rate reached 13.9%.

Against the background of rising raw material prices, various production companies are facing a new round of challenges and loss pressures, posing a great threat to the healthy development of the industry. The association hopes that all member companies should adjust the production rhythm according to market changes, control production capacity, and insist on sales. The second is to standardize business operations, eliminate low-cost sales, strengthen industry self-discipline, eliminate suicide in disorderly competition, and strictly regulate the operating behavior of the whole industry according to the operating rules of the market economy. The third is to increase scientific and technological research and development efforts, reduce production costs through innovation and rationality, and digest some of the price increase factors as much as possible. Fourth, we must attach great importance to the recovery of goods and avoid business risks; we must strictly manage, control costs, and maintain a stable order of production.

The Association also hopes that the downstream industry of the refractory industry should appropriately increase the purchase price of refractory materials, reduce the pressure on the production and operation of refractory industry, and provide the necessary conditions for the survival and development of the refractory industry. At the same time, the Association hopes that relevant government departments will pay close attention to the standardized management of scarce resources such as graphite, scientific mining, rational allocation, control of exports, and full use.

We must pay close attention to and calmly analyze the situation of the raw material market and take measures to respond positively. It is necessary to clarify the direction of business according to the situation, adjust production and marketing strategies, and work together to strive for the understanding of downstream industries and the care and support of government departments to ensure the normal order of production and operation in the whole industry, thus promoting the healthy development of the refractory industry.

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