Heo Jung Woon: Focus on the research and development of ferrotungsten to win consumers by high-quality products
----Interview with Heo Jung Woon , CEO of Woltech Korea
Introduction: Woltech Korea was established in 2014. It is the first ferrotungsten plant in South Korea which focuses on ferrotungsten production by electro-aluminothermic process.
Asian Metal: Dear sir, thanks for accepting this interview. First, could you please give us a brief induction to your company’s main product and situation?
Xu: Woltech Korea, established in 2014, is a ferrotungsten smelter which produces only ferrotungsten in South Korea. We import 80tpm of tungsten concentrate 61-63% and provide ferrotungsten to both at home and abroad. The annual production capacity of ferrotungsten 75%min is around 600t with 50tpm of output at the moment.
Asian Metal: As major ferrotungsten plants in China and Vietnam reduced their output, do you think the supply will remain tight in the global market?
Xu: We are aware of the fact that ferrotungsten suppliers in China and Vietnam reduced their output as ferrotungsten prices had been decreased, with the production costs can’t match tungsten concentrate prices as tungsten mining ceased. In addition to this, as buyers who wanted to keep in stock are holding off purchasing and total output has been decreased due to shrinking global economy, we believe that supply in the market is tight. However, we are optimistic about demand in global market. If supply prices match demand prices, the supply will not be tight in the global market.
Asian Metal: How about the demand of ferrotungsten in South Korea?
Xu: An annual average consumption volume of ferrotungsten in South Korea is around 300t. Before we began to produce, ferrotungsten-based companies had imported 100% from China and Vietnam, but they mostly have consumed our materials since the end of 2015. Few imported material is still consumed, but it has nothing to do with the quantity we apportioned in South Korea. Our customers are very satisfied with Woltech’s ferrotungsten in terms of its quality, price, and delivery.
Asian Metal: Now Chinese tungsten concentrate prices increase too fast, does the tungsten concentrate price in the international market increase? Do you think raw materials’ prices will be a main factor for your product’s price?
Xu: China is the #1 ranked ferrotungsten market in the world. It is sure that Chinese tungsten price mostly affects global tungsten market. The mine we are dealing with also reflects to Chinese prices. The increased price of concentrate has contributed to increasing price of concentrate in the global market. Like as other tungsten-based raw materials, prices of ferrotungsten depend on concentrate prices. Therefore, concentrate prices are the main factor for our product’s price.
Asian Metal: What is the biggest challenge for your company in the near future?
Xu: Established in the first ferrotungsten plant in South Korea, it has received great interest from the industry. We have been receiving inquires from overseas buyers despite we didn’t have much sales abroad.
The most important thing for now is supplying good-quality products and gaining trust from domestic and overseas buyers. To do so, we should keep developing manufacturing technique at Woltech’s research laboratory to provide better quality products and competitive prices.
We currently hold several patents, such as ferrotungsten production technology and ferrotungsten technology utilizing tungsten scrap. We will continue to promote a lot of technology and contribute to ferrotungsten industry. Through all this, improving brand awareness in the global ferrotungsten market is our biggest challenge.
Asian Metal: What about your ideas of different downstream market like European, Asian and American market? Which areas will you focus on in the future?
Xu: Asian markets have concentrated most of the producers and formed a producer-oriented market. Despite the advantage of a shorter travel distance and transit time of shipment, it has been reflecting producers’ opinion in price determination.
European and American markets have little producer so formed a user-oriented market. As it takes a lot of time and the movement distance of the product, it is sensitive to price fluctuations. Traders must have a certain amount of inventory to respond according to changes in demand. For this reason, the sensitivity of the price according to changes in demand is very high.
Spec required by Europe, Asia, and America is slightly different, but we believe that the market structure and trading conditions are deemed similar.
Woltech will intensively focus on the biggest ferrotungsten market, especially European and Japanese market.
Asian Metal: What is your advantage compared with others? How about the production situation of ferrotungsten plant?
Xu: Our advantage is that we secure a stable supply of tungsten concentrate and that we produce one kind of items, ferrotungsten. We are committed to supply ferrotungsten smoothly. In addition, our research laboratory is constantly developing technologies which allow us to produce high quality products. Woltech Korea stably produces ferrotungsten being supplied with concentrate from overseas despite it hasn’t been long after starting production. The average consumption volume for tungsten concentrate is around 80tpm at present.
Asian Metal: What do you think about the future market trend? What is your plan for future sales and development?
Xu: There has not demonstrated any signs of movement in demand at present despite the prices of concentrate and ferrotungsten have been recovered. There will be more demand in the near future if the world economy is gradually recovered. Meanwhile, we will focus on R&D to secure competitiveness corresponding to customers’ needs. Our foremost goal is to become a global leading company by providing superior quality products with competitive price.
