Guangxi Guosheng Rare Earth focuses on special size high purity products to strengthen differentiated competition
----Interview with Lou Zhanhuang Chairman Chinalco Guangxi Guosheng Rare Earth Development Co., Ltd.
Established in 2013, Chinalco Guangxi Guosheng Rare Earth Development Co. Ltd. ("Guangxi Guosheng") is a Level 4 subsidiary of Chinalco. The company focuses on the production, process and sales of rare earth oxides, salts and metals as well as the procurement and sales of rare earth ore. They own an annual production capacity of 3,000t of rare earth oxides now, which is supposed to be enlarged to 6,000t in 2019, including 100t of high purity dysprosium oxide 99.999%min and 10t of high purity lutetium oxide 99.999%min.
Asian Metal: Hello, Mr. Lou! Thanks for accepting Asian Metal's interview. Would you please introduce your company and your major business firstly?
Mr. Lou: Established in 2013, Chinalco Guangxi Guosheng Rare Earth Development Co. Ltd. ("Guangxi Guosheng") owns a register capital of RMB145 million and is a Level 4 subsidiary of Chinalco. Our company focuses on the production, process and sales of rare earth oxides and metals as well as the procurement and sales of rare earth ore. We can also produce rare earth materials with special properties according to customers' requirements, such as neodymium oxide products with special properties and large specific surface area. Our company is a rare earth smelting project approved by the Ministry of Industry and Information Technology during the 12th five-year plan period and has undertaken nearly 20 provincial and ministerial-level scientific research projects over the past five years. It has won the titles of "Pilot and Demonstration Unit of Rare Earth Smelting Intelligent Factory" from the MIIT of China, "Pilot Unit of Cultivating Enterprises with Intellectual Property Advantages" from the Department of Science and Technology of Guangxi Autonomous region, "Model Enterprise of Industry-University-Research Integration in Guangxi Autonomous Region" from IITC of Guangxi autonomous region.
Asian Metal: May I know your next development plan in the near term?
Mr. Lou: Guangxi Guosheng is a new enterprise with a young team. We have finished the construction of our first phase separation line of 3,000t of rare earth ore in 2015. Our products were popular in not only Chinese buyers, but also consumers from Japan, The U.S., Spain and Vietnam etc. We also have finished the construction of our second phase separation line of 2,500t of rare earth ore in late 2018 and plan to enlarge high purity products production in 2019. We are going to produce super high purity products with 99.9999%. We will also provide customized rare earth products and salts with special particle size, specific surface area and low non-rare earth impurities.
Asian Metal: Would you please share your opinion about rare earth high purity products' application status and prospect?
Mr. Lou: The competition among suppliers for part of high purity products is rather furious, such as high purity yttrium oxide 99.999%min and lanthanum oxide 99.999%min. But the additional values of part of special granularity of high purity products is still high, including high purity lutecium 99.999%min and high purity neodymium oxide 99.999%min. The consumption of our under developing nanometer grade dysprosium oxide 99.999%min is supposed to increase sharply in the future.
Asian Metal: Chinese rare earth market was dim in 2018. Prices for most rare earth products climbed in Q1 of 2018 but these prices declined in H2. May I know how about your company's production and operation in 2018?
Mr. Lou: We own a high effective young team. Our business performance in 2018 was good through our joint efforts in rare earth raw material purchase, cost reduction and efficiency increase, product structure adjustment, sales, scientific and technological innovation, and policy funding, etc.
Asian Metal: Would you please share your opinion about the reason for the declining prices? What's your prediction of rare earth prices trend in 2019?
Mr. Lou: In my opinion, importing rare earth ore will become a trend in the future due to the limited mandatory production plan. Imported ore can not only fill the shortage of domestic ore and maintain China's status as a major supplier of rare earth products but also reduce separation plants' production cost. But the key point is how to solve the radioactivity problem.
Asian Metal: As the most important downstream industry, Chinese NdFeB magnet market didn't perform as good as participants' anticipation in early 2018. Some magnet producers believed that China's NdFeB magnet output in 2018 decreased by around 3% to about 145,000t YOY. Would you like to share your opinion about this?
Mr. Lou: Discouraged by the dim economy, Chinese NdFeB magnet industry was not as good as participants' anticipation in 2018. Although some NdFeB magnet plants decreased production last year, some are busy in enlarging output now. I am optimistic towards NdFeB magnet market in 2019 as the increasing demand for it from intellectualization of life.
