----Interview with Hongbin Ma
General Manager
Yuantai High-Conductivity Materials (Shanxi) Co., Ltd.
Yuantai High-Conductivity Materials (Shanxi) Co., Ltd. was established in November 2020 as a foreign-invested enterprise, with registered capital of USD 21.07 million and total investment of USD 50 million. The company currently has an annual production capacity of 120,000t. Its core business includes the melting, casting, production, and sales of high-purity aluminum and aluminum alloy materials for civil applications; R&D of new aluminum alloy materials and processes; and technical services such as failure analysis of aluminum alloy products.
Asian Metal: Mr. Ma, thank you for accepting this interview. Could you please briefly introduce your company?
Mr. Ma: Yuantai High-Conductivity Materials (Shanxi) Co., Ltd. is located in the Xingxian Economic and Technological Development Zone, Lvliang City, Shanxi Province. Relying on 99.85% high-quality molten aluminum supplied by Chalco Huaxing Aluminum, we mainly produce high-quality aluminum alloy bar products in the 2xxx, 3xxx, 4xxx, 5xxx, 6xxx, and 7xxx series, as well as aluminum alloy slab ingots in the 1xxx through 7xxx series. Based on customer requirements, we fully leverage advanced melting and casting units, refining and degassing systems, and homogenization heat treatment furnaces, while optimizing alloy chemical compositions and innovating production technologies. This enables us to deliver high-quality aluminum alloy ingots in a timely manner to better serve market demand.
Asian Metal: In July this year, many aluminum bar producers cut output. What do you think were the main reasons?
Mr. Ma: In my view, there are two main reasons. First, since the beginning of this year, U.S. tariff policies toward China have remained uncertain, leading to a notable decline in some export orders. Second, the new energy sector—especially the solar photovoltaic industry—has entered a bottleneck phase. Growth in new domestic projects has slowed significantly, while export orders have dropped sharply due to tariffs and anti-dumping measures. July is traditionally an off-season for consumption, during which inventories at aluminum bar producers accumulated heavily. To alleviate inventory pressure, many producers began cutting output, with most reducing production by more than 20%. By contrast, we focus on high-end aluminum bar and did not reduce output in July.
Asian Metal: September and October are traditionally peak consumption months for aluminum bar. How did market demand perform this year, and did demand weaken significantly in the fourth quarter?
Mr. Ma: Overall demand for standard 6063 aluminum bar in September–October was weak this year. In previous years, September orders were typically at least 10% higher than August, but this year September orders were basically flat month-on-month. Due to continued weakness in demand from the construction and solar PV sectors, fourth-quarter demand for standard 6063 aluminum bar in South China remained stable with relatively active transactions, while demand in other regions continued to be sluggish.
Asian Metal: How did orders for your high-end aluminum bar perform in the third quarter, and did customer demand increase in the fourth quarter?
Mr. Ma: Our orders began to increase gradually from late July and continued to rise in August and September. Therefore, we are optimistic about fourth-quarter demand. As of October, our aluminum bar operating rate was nearly at full capacity. Our output was 5,600t in July and increased to 6,500t in August. We originally planned to raise September output to 7,000t, but insufficient molten aluminum supply from Chalco Huaxing prevented us from meeting that target. In the fourth quarter, we have sufficient orders and originally planned to increase monthly output to 8,000–9,000t. However, due to continued constraints in molten aluminum supply, our actual output remains at only 6,500–7,000tpm.
Asian Metal: In July, TCs for 6063 aluminum bar turned negative, causing losses for producers. What led to this situation, and does the high-end bar segment face similar issues?
Mr. Ma: The main reason is that the supply continued to increase while downstream consumption failed to show a meaningful rebound. To move shipments, some producers were forced to cut TCs, even selling at a loss, which resulted in negative TCs for aluminum bar 6063. In the high-end bar segment, there is also vicious price competition. For example, TCs for aluminum bar 7075 used to be RMB4,000–5,000/t before orders were accepted, but now market quotes below RMB2,000/t are common. Oversupply also exists in the high-end market, and producers have had to continuously lower TCs to secure orders. As fees keep falling, the quality will inevitably deteriorate.
Asian Metal: The central government promoted anti–“involution” policies in the second and third quarters. What impact has this had on the aluminum bar industry?
Mr. Ma: The problem of excessive internal competition is indeed severe in the aluminum bar industry. Some small companies rely on local government subsidies and compete for market share with low-quality, low-priced products. Companies without local tax rebates or subsidies are forced to follow price cuts and sell at a loss. Over time, this has driven the entire industry into losses, ultimately forcing companies out of the market.
Asian Metal: With the implementation of anti–“involution” policies, what opportunities do you see for your company, and what are your core competitive strengths?
Mr. Ma: If the anti–“involution” policies are effectively implemented and local government subsidies are removed, all companies will compete on a level playing field. Once low-price advantages disappear, low-quality products will be eliminated from the market. For companies like ours that compete on quality, market share will continue to expand. Our strengths lie in investing in advanced equipment and collaborating with research institutions to continuously develop new products and materials, thereby building a technological moat and enhancing product value and competitiveness. For example, we recently worked with Professor Zhiming Zhang from North University of China to develop a 7055 aluminum bar with a diameter of 457 mm, which has successfully completed trial molding and testing. Going forward, we will focus on developing large-size bar products and move further toward customized products.
Asian Metal: What is your company’s future development direction? Are there any new projects under planning?
Mr. Ma: Due to limited molten aluminum supply from Chalco Huaxing, we are unable to further expand production, and we have no plans for new projects. Instead, we plan to move downstream into deep processing. For example, we are considering producing some forged products ourselves, using our own aluminum bar products to manufacture forgings. By increasing the technical content of our products, we aim to enhance value-added, improve profit margins, and expand overall profitability.
Asian Metal: Thank you, Mr. Ma, for this interview. We wish Yuantai High-Conductivity Materials (Shanxi) Co., Ltd. continued success and hope it becomes a leading player in the high-end aluminum bar industry.
Mr. Ma: Thank you to Asian Metal for providing a communication platform for the aluminum industry. We hope Asian Metal will continue to deliver broader, more comprehensive, and more accurate industry information in the future.
