Asian Metal: Mr. Huang Fujun, thank you for accepting the interview of Asian Metal. Please give us a brief introduction about Chengyuan Minerals Distribution Company.

Chengyuan Minerals Distribution Company is mainly producing manganese ore suitable for Metallurgy, Foundry, Environmental Protection, Water Treatment, Chemical and other industries to produce premium steel, plain steel, ferromanganese, and silicomanganese using steel blast furnace, electric furnace and martin furnace. Our manganese ore can be subdivided into manganese oxide and manganese carbonate. Manganese carbonate and low grade manganese oxide are mainly used to wash blast furnace of steel plants and very effective to blast furnace washing, with the specifications of 12-14, 14-16,16-18 and 18-22 degree, Fe 13-15, SiO 16019, S 0.03-0.05, P 0.015-0.04 for furnace washing manganese ore. All the manganese ore of our company is chosen and broken by artificial hammer. Compared with the ore crushed by machine, the cost is high, but the loss is small, and the quality is guaranteed with uniform size. We use machine to crush, screen, separate, dedust the small sized ore into sand, with is used as the manganese sand filter for groundwater treatment. Manganese ore in Chaoyang, with the advantage of high density, high hardness, corrosion resistance and long service life, belongs to the sedimentary rock, and is the primary manganese sand products recommended by Harbin Construction Engineering Research and Design Institute, Daqing Engineering Design Institute and Jinan Engineering Design Institute.

Asian Metal: Would please give us an introduction about the distribution and capacity of domestic manganese ore?

In China, manganese ore is mainly distributed in Guangxi, Hunan, Guizhou, Yunnan, Liaoning, and Sichuan, in specific, Xialei Guangxi, Zunyi Guizhou, Xiangtan Hunan, Chaoyang Wafangzi Liaoning, Pingle Jiangxi, Mozhashala Xinjiang, Malishan Hunan, Qinzhou Guangxi; and in Yunnan Province, it is mainly distributed in Southeast and west Yunnan. In recent years, Houdain Chifeng and Alashan of Inner Mongolia, Siping and Dongfeng of Jilin, Qinglong and Zhangjiakou of Hebei, Hanzhoung Shaanxi, Lingqiu Shanxi. Available reserves are distributed in 21 provinces, municipalities and autonomous regions, of which Guangxi and Hunan are the most crucial, with available reserves of 215 million tons and 103 million tons respectively, accounting for 38% and 18% of the total available reserves in china. Followed by Guizhou (74 million tons), Yunnan (48 million tons), Sichuan (27 million tons), Liaoning (39 million tons), Hubei (14 million tons) and Shaanxi (13 million tons), the reserves of the above 6 provinces total 215 million tons, accounting for 38% of the total available reserves.

Influence of furnace washing by manganese ore on blast furnace slag and its mechanism

The mechanism of furnace washing by manganese ore is that the manganese olivine silicate material of low melting point is generated in slag, thereby increasing the superheat of liquid slag, reducing interphase force in melting state with good fluidity; with the increase of MnO content in the slag, the concentration of free oxygen ions increases, which can depolymerize complex silica tetrahedral network structure into simple silicon oxygen tetrahedron. The more free oxygen ion is, the more completely depolymerization complex silica tetrahedral network structure performs. The slag develops from the complex structure to the simple one, the slag viscosity decreasing significantly.

Asian Metal: Domestic ore increases following the sharply increased imported ore last year, but the supply of domestic ore has not increase. What is the main reason for the phenomenon?

Main production regions of Hunan, Guizhou and Guangxi showed exploration difficulties affected by environmental inspections, security check as well as rainy days in the wet season. The truck load being limited since 21 September 2016 has increased transportation cost largely for other mines, so quite a few producers started to reconsider ore sources. Some producers began to purchase imported manganese ore as the main material while domestic one as the auxiliary material, greatly reducing the supply of domestic ore.

Asian Metal: What is your opinion on price trend of Q2 2017? And what’s the reason?

Manganese ore increased significantly in 2016, leading to considerable profit space, so quite a few domestic traders participant the field in 2017. And steel inventory days should also improve, so the speculative demand has also changed the pattern of oversupply. In addition, the futures market participation rises, which is a favorable factor for the silicomanganese alloy market. But from the negative side, the silicomanganese market in 2017 still face treat pressure from high operation rates of silicomanganese, new capacity pressure, the reducing trend of crude steel production, increased supply caused by price rise for foreign manganese ore, the recovery of domestic ore, large occupancy rate of capital and other problems. Converted into specific date, the domestic crude steel production is expected to be 803 million tons in 2017, and 7.23 million tons of silicomanganese are expected to be used while the output of the material is expected to be 7.6 million tons, so there is still about 4.8% of the excess. However, the oversupply situation will be improved to some extent due to the active participation of manufacturers, traders and steel mills, and all players still should take part in the market with caution in 2017.

Asian Metal: What’s the influence of environmental inspections in Hunan and Guizhou to domestic manganese ore price trend?

Domestic manganese ore prices might increase to some extent due to environmental inspections in Hunan and Guizhou, but not in great ranges. After all, environmental inspections are not only performed in Hunan and Guizhou, but other provinces and cities are also performing environmental management, and some steel and chemical industries will suspend production accordingly. Therefore, the demand for manganese ore will decrease. Prices would not increase too much in view of decrease in both demand and supply. Meanwhile, with certain foreign ore reserves held in Qinzhou port, Tianjin port and Lianyungang port, some international traders also adjust imports in accordance with the market demand, so the suspension in Hunan and Guizhou will produce limited upward force to domestic manganese ore prices in the short term.

Asian Metal: Chaoyang manganese mine opens for limited time during a year affected by environmental issues. Under this circumstance, how to keep the largest profit?

Our company is introducing the deep processing technology of high-end manganese ore, and processes locally as much as possible by the limited resources and under the premise of environmental and ecological friendly process to improve the additional value of ore, maintain profit space and employ lad-off workers caused by the suspension of mine at the same time.

Asian Metal: Thank you once again for accepting the interview of Asian Metal.