(1) the first half of the steel industry's demand for refractories is relatively stable

National Bureau of Statistics data released on June 15, January to May, China's crude steel production of 444.63 million tons, an increase of 1.6% year-on-year; pig iron production of 374.74 million tons, an increase of 3.2% year-on-year; steel production of 557.06 million tons, an increase of 3.2% year-on-year. in May, China's crude steel production of 90.12 million tons, a year-on-year decrease of 7.3%; pig iron production of 77 million tons, a year-on-year decrease of 4.8%; steel production 118.47 million tons, down 1.3% year-on-year.

China Iron and Steel Industry Association data, in late June the country's daily crude steel production of 2.9368 million tons, down 0.54%, the daily production of 2.4602 million tons of iron, an increase of 0.41%, daily steel production of 3.9192 million tons, an increase of 0.95%. According to the above data I estimate that in January-June 2023, the iron and steel industry crude steel production is basically the same as last year. This shows that the demand for refractory materials in the steel industry is still relatively stable.

According to the data of digital cement network, from January to May, the national cumulative cement production of 771 million tons, a year-on-year growth of 1.9%, a growth rate of 0.6 percentage points lower than that of January-April, the same period last year was a decline of 15.3%; in May, the national single-month cement production of 196 million tons, a small decline of 0.4% year-on-year, a ring increase of 1.3%, the cement production for the same period since 2012, the lowest level.

In the first half of 2023, steel production, cement production and market perception is very different, the official data of the National Bureau of Statistics will soon come out, these data and everyone's daily perception of the difference is not small, as if the economic recovery is not so good, but the production of so much steel and cement to go where?

China Refractory Association caliber national refractory production, especially the key backbone enterprise production and operation data are being counted, it is estimated to be completed by early August. But according to the Association's grasp of the situation, whether it is consuming refractories, or infrastructure refractories, the first half of the key backbone enterprise production is basically still full, the total demand from the volume is still good, of course, the economic benefits of talking about.

(2) the first half of the refractory export volume, export trade volume decreased significantly year-on-year

According to customs statistics, January-May national exports of refractory raw materials 1,927,700 tons, down 3.1% year-on-year, exports of refractory products 858,500 tons, down 2.7%.

Export prices, the average price of raw materials fell 6.82% year-on-year. The biggest decline was in magnesium raw materials and natural flake graphite. The decline was about 15%. The average export price of refractory products decreased by 1.47% year-on-year, of which the average export price of alkaline products decreased by 11.26%; the average export price of aluminum-silicon products increased by 10.07%; the average export of other refractory products decreased by 5.34% year-on-year.

According to the association research domestic mainstream refractory export manufacturers, this year's economic benefits of export production is less than last year. Emotionally more cautious about the export situation than at the beginning of the year, the overall view that the export of refractory materials in 2023 is less than the year 2022.

(3) Refractory raw materials market sentiment in the first half of the year

The current bulk refractory raw materials market and logistics costs overall performance is low and stable. Into the second half of the year, the overall performance of the domestic bulk raw materials market is weak but stable. The price of white corundum and flake graphite was adjusted downward to different degrees, and other products continued the downturn trend. What should be lowered has been lowered.

The inventory level of white corundum and brown corundum producers is high, so the number of enterprises choosing to stop production and limit production has increased. Price, homogenization competition is more intense, the market is more low-priced sources, coupled with the low price of alternative products, producers have to further compress the profit margin, the market trading center of gravity moved down, the price has bottomed out.

Association and Liaonan area enterprises to communicate, the current magnesium sand enterprise start rate is low, and shutdown, production restrictions on more enterprises, magnesium sand production line capacity utilization rate is low, magnesium sand supply and demand is basically stable, magnesium sand price fluctuations at the bottom of the characteristics of the obvious.

After 4 consecutive months of downward adjustment, the silicon carbide market continued the downturn trend at the end of June, although the inventory level of silicon carbide producers has been reduced, but due to the downstream demand is low.

At this stage, the scale graphite producers in Luobei area have basically resumed production, the demand for scale graphite grows more slowly, with the increase in supply, graphite still has the possibility of decline, but with the cost line getting closer and closer, the space for decline is more limited.

Bauxite raw ore prices are still firm, high-grade bauxite transactions to maintain a high level, low-grade bauxite oversupply, polarization of the situation continues.

Overall, raw material prices have fallen, want to rise is also difficult. Subsequent market can simply think, the current raw material prices down, up are not much space.

At present, the raw material market, one of the biggest factors of change is that the Liaoning provincial government level to the market economy approach to magnesite resources for comprehensive management, positive attitude, action faster. May have a greater positive impact on the market, it is worth paying attention to. The first half of the industry several refractory raw materials trade fairs, popularity is quite hot, but also from another angle reflects the raw material manufacturers of the involution and users of the market's high degree of concern.

(4) the first half of the refractory materials enterprise profit decline is serious

The current industry dynamics is that the steel mills are having a hard time, the refractory materials contracting price pressure to the limit. Refractory products manufacturers, "volume" is okay, but "price" is quite bad. Extreme example is the total price level of regional contracting, from iron to intermediate package of the whole process down to 40 yuan / t level or so, this price is not normal, is unsustainable.

Infrastructure refractory producers are also having a hard time, with some of them making do with contracts during this year, but next year's contracts are completely out of the picture.

Since 2022 3, 4 quarter, due to the operating efficiency of the steel mills fell sharply, bringing down the refractory materials regional contracting prices, according to the association to grasp the industry's overall rough situation, the vast majority of enterprises in the industry is currently the first half of the year compared with the same period last year, the profit slump is serious. Enterprise losses further expanded. This has the steel mills to reduce costs and increase efficiency of the price pressure factor, but also due to unfair competition in the industry counterparts. Association has received a number of reflections, some manufacturers, ultra-low bidding "stirring the pot", and then play "disappeared" to see the fun, some of the price range of 30% or more, so that the peers and steel mills are at a loss. At present, the refractory industry's profits have plummeted, the competition is quite fierce. Association here again called on industry peers, resolutely opposed to below-cost competition industry, resolutely opposed to bidding in the "spoiler" behavior. Industry self-regulation is very important at this stage.

To solve the current industry "volume" problem is more prominent than ever, in the total demand is no longer a significant increase in market conditions, the pattern of competition is changing. Association has advocated the "industry interests over corporate interests" concept, but also put forward the industry's high-quality development, to "control the total amount, revitalize the stock, scientific and technological innovation, transformation and upgrading". At the cognitive level, the low price to grab the contract, through the immediate difficult days, this behavior can not be too much, should reflect. Because it is not sustainable.