Asian metal: Thank you for accepting our interview. Firstly, what do you think of the current macro economy and industry background?

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Mr Zhong: After the long time economic crisis, the economy situation in most parts of the world is turning better. However, the recovery is not that significant, so it will take a long time for brown fused alumina market to recover. meanwhile, environment protection is essential to brown fused alumina industry. There are 25 furnaces passing environment impact assessment in Yichuan County, Henan Province. If we do not pay high attention to environmental production, it is hard for such industries to develop in our local area.

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Asian Metal: Really. What's your opinion on the supply and demand situation in brown fused alumina market currently?

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Mr Zhong: The demand for brown fused alumina shoule be quite huge, but this year, the demand has shrunk a lot due to the economic crisis. Although it has been recovering since February, the whole market is still in relatively oversupply. Meanwhile, customers are more particular to brown fused alumina. For example, they prefer to purchase brown fused alumina processed by Barmac technology. Our downstream customers are facing more severe challenges too, so they need to purchase raw materials with higher quality and lower price. Our ideal is: Offer the best services to our customers. To achieve this, we set high standard to our goods, and have piled up about 4,000t of stocks.

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Asian metal: That's really a big quantity for your company.

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Mr Zhong: That's for delivering the material to customers at their notice.

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Asian Metal: What's your opinion on technology innovation and industry upgrading?

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Mr Zhong: These are very important to brown fused alumina market. To avoid the serious price battle, smelters should draw more attention on increasing added value on brown fused alumina.

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Asia Metal: So it is. The so-called oversupply in brown fused alumina market indicates that the oversupply of primary products. The advanced products need developing. The serious prices battle in the market should be attributed to the undeveloped industrial technology in the market, to some extend. As far as I am concerned, Dongfeng has been devoting to technology innovation and industry upgrading. Could you please introduce the performance indicator of Dongfeng?

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Mr zhong: We are devoting to the deeply processing now. We have just established the production line of the P grinding sands and our output will reach 1,500t, which can not meet the demand from buyers. We will expand the production in the coming years.

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Asian Metal: Do you have any suggestions to our government?

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Mr Zhong: We advice our government to modify the export tariff, changing ad valorem tariff to the specific duty. This will be more beneficial to our country.

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Asian Metal: Do you have any other suggestions to the whole industry?

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Mr Zhong: I hope we can join together. I do not want to see the price battle any more, as this is too harmful to the whole industry.

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Asian Metal: What's your prediction towards brown fused alumina market in the short and mid-term?

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Mr Zhong: Firstly, brown fused alumina market is closely related to steel market. When the steel industry recovers, the demand for brown fused alumina will increase. According to the prediction from experts, nothing can take the place of brown fused alumina in the following 200 years. In the recent one year, the demand for brown fused alumina has been unstable. It keeps slow in general, but purchasing climax shows up occasionally. I do not believe there will be significant improvement in the fourth quarter of this year, as the economy may go through W-Curve. The foundation of economy recovery is still fragile. Brown fused alumina for export will keep slow in the short and mid-term. Secondly, the price battle in the market will not disappear this year. For example, the price for brown fused alumina shipped to Russia was very low. In fact, the price is too low for smelters to make profit. Meanwhile, some suppliers offer rejected product in the name of eligible product. This brings a bad reputation for Chinese products in the world market. This is the tragedy caused by price battle.

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Asian Metal: Thanks again for your interview with us!

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Mr Zhong: You are welcome!