Asian Metal: Please give us a brief introduction of your company.

Mr. Yang: Formerly known as Hebei Anxin Nandi Guangming Smelter, which was founded in 1983, the plant changed its name to Anxin Xinyue Nonferrous Metals Co., Ltd. in 2005 in order to respond to central government's call for factory restructuring. Located in Nandi Industrial Park, Laohetou town, Anxin county, Xiongan New Area, Hebei province, the company is mainly engaged in production of bearing metal, tin solder, copper alloy and tin products with tin, copper, antimony, lead, silver and others as raw materials. The company filed a trademark application for Yanghai brand in 1989 and successfully registered. With an annual production capacity of 3,000 tons of bearing metal, 1,000 tons of tin solder, 2,000 tons of copper alloy and 8,000 tons of tin products, the company has a sound reputation in the industry supported by years of efforts. We will continue cooperating with both new and old partners and create a bright future with them together.

Asian Metal: Could you introduce your downstream customers? What impacts does the pandemic make on them?

Mr. Yang: Most of our downstream customers are cement machinery, ship machinery, coal mine machinery, iron and steel machinery and large steam turbine companies and some are defense industry enterprises. Most of our downstream customers couldn't resume normal production after the outbreak of COVID-19 in early 2020 and our orders declined to some extent. As pandemic restrictions were cancelled and export market recovered gradually, the majority of downstream customers were in normal production. Their output in August and September was basically in line with the same period of last year and our orders went back to the level in the corresponding period of last year accordingly.

Asian Metal: Why do you turn to production of tin alloy from smelting of refined tin?

Mr. Yang: Firstly, we focus on production of tin alloy that has little environmental impacts at present to answer the call of central government and local government for environmental protection as our company is located in the border of Beijing, Tianjin and Hebei and Hebei Xiongan New Area, a new national area. Secondly, Xiongan New Area is oriented to high-end, high-tech and high-quality technological new materials enterprises, so business transformation is an irresistible trend. The last point is also the most important one. Raw material constraint is a key factor resulting in falling refined tin production. As Chinese market witnessed an increasing number of tin smelters and expanding production capacity in recent years, raw material supply is tight and profit margin narrows gradually at present. Against this background, we turn to production of niche products and high added-value products, which represents the general trend.

Asian Metal: How do you survive amid declining raw material supply and fiercer market competition?

Mr. Yang: In order to cope with declining raw material supply and fiercer market competition, we continue increasing investment in technology and product development, keep innovating and try to improve our core competitiveness. Being in a complex market environment, we look for demand of target customers, carry out differentiation strategy, make use of channel and production advantages of a time-honored producer and give a play to scale merit, trying to establish our brand and playing a valuable role in tin smelting industry and processing industry.

Asian Metal: Will the raw material supply of tin smelters ease in Q4 with production increase of downstream tin solder producers and other scrap industries?

Mr. Yang: Chinese tin smelters expanded production notably from 2016 to 2018, which led to excessive production capacity of the industry. As the industry pattern was not adjusted, the raw material supply was still far below the demand from smelters although tin scrap supply increased slightly and many producers resumed normal production in the second half of 2020, in terms of current production capacity and the number of smelting enterprises, resulting in increasing raw material prices and narrowing profit margin of smelters. Therefore, tight raw material supply of tin smelters is unlikely to ease in a short period with the same pattern of tin smelters.

Asian Metal: What are your expectations to tin smelting industry in Q4?

Mr. Yang: Tight raw material supply will still be a main factor restraining development of tin smelting industry in the fourth quarter. With falling Burmese tin concentrate supply and intensified competition for secondary tin, some Chinese smelters might have difficulties in maintaining normal production. In the fourth quarter, a few smelters would be forced to reduce production and suspend production amid tight raw material supply and high production cost.

Asian Metal: Do you think the pattern of tin smelting industry will change next year due to such fierce competition?

Mr. Yang: Amid such fierce competition, I believe that raw material shortage would be intensified and violent fluctuations of tin ingot prices would make negative impacts on confidence of producers. High cost may force some tin smelters to turn to other businesses or withdraw from the market.

Asian Metal: What are your opinions about tin market in 2021?

Mr. Yang: With relatively low consumption of tin ingot, the supply of refined tin would be abundant and prices would keep fluctuating. Considering the inevitably falling supply of Burmese tin concentrate and continuously fierce competition for secondary tin, the supply of raw material would remain tight in the near term. From the perspective of consumption, downstream enterprises would continue purchasing from hand to mouth. Enterprises with raw material stocks might give priority to consuming stocks when prices stand high and make purchases when prices stand low. Tin ingot market would see limited deals and low prices next year because of no increase in market demand and strong wait-and-see attitude of consumers. Under such circumstances, 2021 will be a tough year for tin smelters.

Asian Metal: Thanks for your wonderful comments. Wish your company a brighter future!

Mr. Yang: Thank you.