AM：Thank you for accepting the interview with Asian Metal, Mr. Huang! Will you talk about the developing history of ferroboron？

---

Huang：Mr. Moissan, a French chemist and academician of French Academy of Science made simple substance of fluorine on June 26, 1886, shocking the scientific community. Meanwhile, Mr. Moissan designed a new electric furnace heating through electric arc (Moissan Furnace) and made single substance of boron by this furnace as well as high carbon ferroboron in 1893. With science progressing, many patents of producing ferroboron were invented in 1920s. By the end of 1950s, China Iron and Steel Research Institute successfully produced ferroboron by aluminothermy, and Liaoyang Ferroalloy Plant started to produce ferroboron by electric-furnance—carbon reduction method.

---

AM: How did technology of smelting ferroboron develop in the past years?

---

Huang:Ferroboron can be smelted in two prevailing and steady ways of aluminothermy and carbon reduction at present.

---

Originally, only ferroboron containing 10% of boron or below can be produced, but now the containing boron of ferroboron increases to 25% and patterns of the material develop from the single form of high-carbon ferroboron to low-carbon, ultra-low-carbon, low-aluminum, ultra-low-aluminum, low-silicon, and low-phosphorous ferroborons, besides, today, we produce ferroboron through aluminothermy or carbon-reduction instead of various initial techniques.

---

Chinese enterprises upgrade the technique as they substitute raw materials of charcoal, saw dust and rice husk, and boron coke by petroleum coke, wood chips, and boron anhydrous respectively and they improve the power of arc furnace from 1800KVA, to 3200KVA, 5000KVA, 6300KVA, and 7500KVA step by step. Although each improvement costs large quantity of personnel, material and fund, ferroboron industry develops gradually as the capacity expands from 3,000t to 6,000t, 8,000t and 20,000t step by step.

---

AM: Thanks for your instruction of your company, and we also want to know the total production capacity in China, can you introduce further?

---

Huang: Accordingly, there are very 5 producers of ferroboron in China at present, with the annual capapcity of 20,000t for one, 155,000t for one, 6,000t for two and 3,000t for one, totaling 50,000tpy, while Japan produces 15,000t of ferroboron annually. In 2010, China produced about 30,000t of ferroboron and Japan produced 13,000t.

---

AM: Chinese ferroboron market firmed up in both domestic sales and export in the first half of this year. What is the main factor pushing it up?

---

Huang:In China, main raw materials of ferroboron are boric acid, petroleum coke, wood chips, and scrap iron for carbon reduction method, among them, boric acid occupies 40%-50% of cost, in addition, the power cost accounts for 20%-30% since the production of ferroboron needs arc furnace. Over the past few years, boric acid consumption sharply increased owing to the rapid expansion of Chinese ceramics and glass industries, and China started to rely on the imported boric acid as the boron ore resource is exhausting in China due to over-mining. In the beginning of 2011, prices of boric acid climbed up as the domestic supply of boric acid tightened affected by the flood in Latin America and the reduced import of boric acid from Turkey. So the price of domestic boric acid surged to RMB8,500/t in late May from RMB6,500/t in the beginning of 2011 even the price of imported boric acid surged to RMB9,500/t, while the export price of ferroboron increased to USD4,400/t in late May from USD3,800/t.

---

AM:In addition to the influence by raw material changes, demand is also the key factor. How about the demand for ferroboron at present?

---

Huang:Demand for ferroborn grows as boron-contained steel increases in category with the widening application of boron-contained steel in military industry. Demand for common ferroboron looks to further increase rather than decrease in the future as local war might happen due to the tensions in Lybia and anti-terrorism task in Afghan and Pakistan and the automotive industry develops steadily.

---

With the sunrise development, demand for soft magnetic material of non-crystal alloy strip increases globally, especially in China as the consumption of soft magnetic material of non-crystal alloy strip will continue growing, accelerated by the enlargeing consumption of UHV transformers in the overall upgrade of grid for countryside in China, which drives the increase of demand for low-aluminum ferroboron.

---

Meanwhile, the production of low-carbon and ultra-low-carbon ferroboron is likely to increase as another sunrise industry-permanent magnetic material of NdFeB, whose applications are widened in hybrid electrical vehicle, wind driven generator, electrocar, micromotor industries, moves into the direction of large-scale and perfect performance.

---

Therefore, the demand for ferroboron will further increase

---

AM:Can you outline the role of Chinese ferroboron in the international market?

---

Huang:The trend of ferroboron price reveals that the ferroboron price fluctuated with the economic changes as the price surges when the economy booms. Chinese ferroboron market is the indicator of international ferroboron market as 70% of global ferroboron comes from China, so one can dominate the global ferroboron market indirectly by controlling Chinese ferroboron market.

---

AM:Do you think ferroboron prices will increase further in the near term?

---

Huang:The market will face up with the overcapacity suppose that the actual capacity of Chinese ferroboron producer is completely put into operation. Therefore, Chinese producers might not expand production in two years and produce the material complying with the sale volume, to meet the demand.

---

With the permeating implement of the national Twelfth Five Year Plan and the improvement of energy saving and emission reduction, high-energy intensive enterprises will encounter with severer restriction, hence, it is unlikely to cancel or degrade the export tariff, so the price of ferroboron will not turn into a significant decrease. On the contrary, the price of ferroboron might continue to go up steadily as the exchange rate of RMB increases and the power price may be lifted in the future.

---

In all, the ferroboron market will have a balance supply and demand with the price steadily climbing up.

---

AM:Thanks for your time!

---

Huang: You are welcome!