In 2017, it was a turning year for China's refractory industry，and the long-term supply surplus has caused a big crisis in refractory industry from raw materials to products. Refractory industry is subject to environmental protection, the tight supply of raw materials lead to the price increases, from the binder products to the magnesium materials and then to the high-aluminum raw materials .

Rising factors:

(1) The rising cost of environmental protection is the main issue for all enterprises. Refractory enterprise brought too many problems for environment. The use of new environmental protection equipment will cause the problem of cost rising in the whole industry circle, but this rise is a must, because we should take responsibility for the pollution of the environment.

(2) The refractories enterprises are affected by a round of environmental supervision. The situation of insufficient supply of products is abound. The reform of supply-side has achieved initial success, and the fruits of de-capacity and de-stocking have achieved fruitful results.

(3) In 2017, government-led factors in refractory materials, especially magnesian materials, are clear. The government-led factors are also strong.

(4) Judging from the industrial chain of refractory materials, the profit margin in the downstream (steel, foundry, cement) industries has increased, and the effect of de-capacity has emerged. Raw material prices transmitted to the downstream and downstream businesses had better financing condition, the improved of withstand the stress is also the reason for the price increases.

Looking forward to the raw material of refractory in 2018:

First condition: when the market price of bulk raw materials is high and stable, the environmental tax levied in various industries of the industry this year at least supports the high and stable price of refractories this year.

Secondary conditions: the Ministry of environmental protection will start the second round of national environmental supervision at the right time, and it is not obvious that the supply of raw materials for refractory materials will be promoted this year.

Macro conditions: the new era of China's economic development is coming. Its basic feature is that the economy has shifted from high speed growth stage to high quality development. Although China's economic growth rate may slow down in 2018, the overall operation is still stable, and there will be no significant fluctuation.

In summary, refractory raw material prices are unlikely to rise sharply, but it is possible to keep stability. The profit change of the downstream market is also an important aspect. If the profit of the downstream industry continues to improve, it will be more acceptable for the price of raw materials to rise, otherwise, it will not happen. In the process of actively putting into production and environmental protection reform, all refractories enterprises should also consider how to reduce costs and how to enhance the added value of products. The era of winning by quantity is over, and it is especially important for enterprises to enhance their own internal driving forces, which requires enterprises to do a good job at the same time the product should be better value-added products.

2018 has come, we believe that the sunshine always after the rain, happiness after the struggle! Finally, in 2018 Fu Hao Company wishes your business could scale new heights this year!