Asian Metal: Good day, Mr. Yang. Thank you for granting this interview. Could you please make a brief introduction of your company?

Yang：The FANYA Metal Exchange (FYME) is the biggest spot trading and investing platform of rare metals in the world. It is the earliest professional spot transaction exchange on metals approved and regulated by Chinese government. There are eight categories and ten varieties of listed commodities, which include indium, germanium, gallium, bismuth, cobalt, wolfram, silicon and silver.

Asian Metal: As we all know, tungsten industry has many kinds of products. Could you explain why your company chooses APT as exchange products?

Yang: Compared with the trading volume of tungsten bar, that for APT is larger in the spot market, and the demand for APT is widely. Furthermore, the quality standard for APT is approbatory in the global market and the prices attract more attention from the market participants. It is more suited to be listed product on FYME.

Asian Metal: Seen from APT suppliers, FYME mainly chooses Ganzhou, Jiangxi as the major supply area. May I know the basic requirements for suppliers?

Yang: We choose warehouses and initial major suppliers in Ganzhou, which is a main APT production area and circulation center in China, for transportation and stocking convenience. Location of suppliers is not requested; however, specific brands are needed for goods supplied by producers. Requirements are as follows: listed brand on exchange, products quality coinciding with exchange requirements, enterprises gaining certain market positions, enterprises operating for over three years with good financial positions, lifelong quality warranty and other requirements requested by the exchange.

Asian Metal：Will FYME make purchases in spot market directly?

Yang: Fanya Metal Exchange, a non-ferrous metal trading platform, offers purchase-sale and financing services for enterprises as well as convenient and effective rare earth investment services for investors, instead of making purchases in spot market directly. All available stocks are purchased by members of the exchange.

Asian Metal: Chinese tungsten market fluctuated significantly in 2013, seeing great improvement in H1 promoted by China Minmetals and returning to reasonable levels in H2 owing to weak demand from end market. Prices of APT, a sub-product of tungsten concentrate, changed considerably, remaining high on Fanya Metal Exchange in spite of continuous decline in the market. A handful of participants wonder whom to pay for such high prices.

Yang: There is a pricing difference between Fanya Metal Exchange and traditional market which makes the price deviation. The price is determined by supply and demand in traditional market while in Fanya Metal Exchange it is different, but also by equity participation which confirms the universal pricing rule of bulk resource-oriented goods. Financing volume and purchasing power of participants will determine the price. For example, if Bank of China was listed on Hong Kong Stock Exchange Co. and mainland stock market on the same day, the share price varies a lot which is the similar phenomenon.

There are only producers, traders and consumers participating in traditional market where organizations and individual investors are difficult to be involved. However, Fanya provides a platform for multi-parties to invest on rare metal including not only buyers and sellers, but also investors who are more concerned about trends and future growing. Besides, prices of different items in Fanya Metal Exchange reflect the preference degree of investors to various items.

Asian Metal: As APT stock volume of your company increases largely in Ganzhou warehouse, will the storage capacity continue to expand unlimitedly?

Yang: The inventory level is determined by the transaction behavior of its members and market condition. As a general rule, the inventory volume will increase when it is oversupplied, it will keep stable when supply and demand is balanced and it will decrease when it is short supplied in the market. As APT market is a mature raw material market with a solid demand and limited supply, inventory level of Fanya platform will not expand unlimitedly. The reason for the recently rapid growth is that Fanya transforms some shadow social inventory to apparent inventory of the Exchange which not only offers inventory information for enterprises to make decisions, but also satisfies investment demand of investors. When social shadow inventory decreases, stock volume of Fanya will slow down to increase.

Asian Metal: Electronic trading platform attracted more attention increasingly along with further development of market economy, may I have your comments on the future development of electronic trading platform?

Yang: Electronic trading platform is an important part of the internet financial, and the financial times will inject limitless liquidity to internet spot platform. Fanya Metal Exchange, as the leader of the electronic trading platform, has brought great changes for non-ferrous metal industry especial rare metals in two and a half years, becoming the world’s largest rare metal trading platform. Spot trading platform will butt joint internet financial service providers and absorb social idle funds and provide personalized financial services for the majority of enterprises and individuals to obtain more broad space for development in the future on the basis of directly facing the customer.

Asian Metal: what influence has Fanya electronic trading platform brought to the industry and overall market development in current market environment?

Yang: Enterprises, engaged in the rare earth metal production, circulation and consumption, can achieve the following goals through the Pan-Asia electronic trading platform.

Fetch a good price-Fanya-pattern creates needs of investment and financing, and current both sides of buyers and sellers should not only considering the relation between supply and demand but also pay more attention to the intrinsic value of the goods and its growth with the participation of investors; Fanya-pattern solves the financing problem for the rare metals manufacturers, and ease the liquidity pressure and enterprises are more likely to find more reasonable and favorable price.

Revitalize the stock. Despite sufficient funds, enterprise operators still hope to deplete stocks to scale up operation and reduce business risks. Fanya-pattern, a special commission and trustee business style, will help enterprises to achieve the goal with easy and flexible declaration procedures as well as timely and fully placed capital.

Avoid price risks. When there is expectation of price declination during rare metals production and operation, enterprise can authorize other members to offer materials on the basis of bearing the commission cost according to the "entrusted sale" term in the project, and then they can organize production without the risk of price decrease.

Enlarge operating earnings. When there is expectation of price hikes, according to the "entrusted purchase" term, enterprise can authorize other members to advance money on procurement to increase stocks and realize larger operation scale and benefits which can't be achieved by own capitals, creating a new way to achieve higher returns for rare metal producers and traders.

Purchase with installment payment. Producers and purchasers can authorize other members to pay for the material through the "entrusted purchase" term to lock price and quantity timely and then pick up goods and settle account gradually.

Overall, with the continuous development and improvement of electronic platform in Fanya, three functions will be formed in providing customer flow, raising capital and circulating goods as well as discovering price in line with three goals, balancing supply-demand, reducing market risks and stabilizing price, bringing sound development to the whole industry.

Asian Metal: Thank you very much for your interview and wish you smooth work and thriving businesses in your company.