platts steel & ferroalloys conference - 2005 presented june 14, 15, 2005 by zigong international...
TRANSCRIPT
![Page 1: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/1.jpg)
Platts Steel & Ferroalloys Conference - 2005
Presented June 14, 15, 2005 by Zigong International Marketing, LLC421 High Street, Fairport Harbor, OH 44077, USA
China Tungsten
Today
![Page 2: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/2.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Zigong International Marketing, LLCZigong International Marketing, LLC
JV subsidiary of the Zigong Cemented Carbide Company (ZCCC)
![Page 3: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/3.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Zigong International Marketing, LLCZigong International Marketing, LLC
JV subsidiary of the Zigong Cemented Carbide Company (ZCCC)
ZCCC is the second largest producer of carbide products in China and in the top 15 world wide
![Page 4: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/4.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Zigong International Marketing, LLCZigong International Marketing, LLC
JV subsidiary of the Zigong Cemented Carbide Company (ZCCC)
ZCCC is the second largest producer of carbide products in China and in the top 15 world wide
Exports more than 3,000 mt of tungsten products annually
![Page 5: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/5.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Zigong International Marketing, LLCZigong International Marketing, LLC
JV subsidiary of the Zigong Cemented Carbide Company (ZCCC)
ZCCC is the second largest producer of carbide products in China and in the top 15 world wide
Exports more than 3,000 mt of tungsten products annually
4,000 mt carbide capacity, over 3,000 employees
![Page 6: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/6.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Tungsten in ChinaTungsten in China
Considered a National Strategic Material
![Page 7: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/7.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Tungsten in ChinaTungsten in China
Considered a National Strategic Material
Identified as a “State Trading Commodity” by the WTO
![Page 8: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/8.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Tungsten in ChinaTungsten in China
Considered a National Strategic Material
Identified as a “State Trading Commodity” by the WTO
Exports controlled by licenses starting in 2001/APT/AMT/BTO/YTO/W/WC/Cast/scrap/SW/ CaW/W Acid
![Page 9: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/9.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Tungsten in ChinaTungsten in China
Considered a National Strategic Material
Identified as a “State Trading Commodity” by the WTO
Exports controlled by licenses starting in 2001/APT/AMT/BTO/YTO/W/WC/Cast/scrap/SW/ CaW/W Acid
Majority of world tungsten supply and resources are from or in China (75%)
![Page 10: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/10.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
License SituationLicense Situation
17,000 mt in 2001
![Page 11: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/11.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
License SituationLicense Situation
17,000 mt in 2001
16,200 mt in 2004
![Page 12: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/12.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
License SituationLicense Situation
17,000 mt in 2001
16,200 mt in 2004
Ran out of licenses in October 2004
![Page 13: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/13.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
License SituationLicense Situation
17,000 mt in 2001
16,200 mt in 2004
Ran out of licenses in October 2004
First half 2005 12,100 mt vs. 11,500 mt in 2004
![Page 14: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/14.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
License SituationLicense Situation
17,000 mt in 2001
16,200 mt in 2004
Ran out of licenses in October 2004
First half 2005 12,100 mt vs. 11,500 mt in 2004
Total 2005 to be slightly lower than 2004
![Page 15: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/15.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
License SituationLicense Situation
17,000 mt in 2001
16,200 mt in 2004
Ran out of licenses in October 2004
First half 2005 12,100 mt vs. 11,500 mt in 2004
Total 2005 to be slightly lower than 2004
We expect a license shortage later in 2005
![Page 16: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/16.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
License SituationLicense Situation
17,000 mt in 2001
16,200 mt in 2004
Ran out of licenses in October 2004
First half 2005 12,100 mt vs. 11,500 mt in 2004
Total 2005 to be slightly lower than 2004
We expect a license shortage later in 2005
Only a few companies have access to these licenses – Minmetals/Xiamen/Zhou Zhou/ Zigong/Nanchang are the primary exporters
![Page 17: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/17.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Export Statistics: Q1 2004 vs. Q1 2005Export Statistics: Q1 2004 vs. Q1 2005
2004 2005 (mt of material)
APT/AMT/ST 1,502 1,301
YTO/BTO/Acid 2,217 1,921
W/WC/Cast 888 1,071
FeW 1,079 881
Totals 5,686 5,234
(Source: Mr. Fang Jinyun, Minmetals Head Office, Beijing) Thanks Fang.
![Page 18: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/18.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Top 10 Reasons Top 10 Reasons Tungsten Price Has IncreasedTungsten Price Has Increased
1. Demand (oil/coal/global/China growth)/ Supply Balance
![Page 19: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/19.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Top 10 Reasons Top 10 Reasons Tungsten Price Has IncreasedTungsten Price Has Increased
1. Demand (oil/coal/global/China growth)/ Supply Balance
Mines:
2. Shut for Environmental Adjustment
![Page 20: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/20.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Top 10 Reasons Top 10 Reasons Tungsten Price Has IncreasedTungsten Price Has Increased
1. Demand (oil/coal/global/China growth)/ Supply Balance
Mines:
2. Shut for Environmental Adjustment
3. Purchased by new owners (Minmetals)
![Page 21: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/21.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Top 10 Reasons Top 10 Reasons Tungsten Price Has IncreasedTungsten Price Has Increased
1. Demand (oil/coal/global/China growth)/ Supply Balance
Mines:
2. Shut for Environmental Adjustment
3. Purchased by new owners (Minmetals)
4. Miners realized they really control the market
![Page 22: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/22.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Top 10 Reasons Top 10 Reasons Tungsten Price Has IncreasedTungsten Price Has Increased
1. Demand (oil/coal/global/China growth)/ Supply Balance
Mines:
2. Shut for Environmental Adjustment
3. Purchased by new owners (Minmetals)
4. Miners realized they really control the market
5. Need to make money after years of suffering
![Page 23: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/23.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Top 10 Reasons Top 10 Reasons Tungsten Price Has IncreasedTungsten Price Has Increased
1. Demand (oil/coal/global/China growth)/ Supply Balance
Mines:
2. Shut for Environmental Adjustment
3. Purchased by new owners (Minmetals)
4. Miners realized they really control the market
5. Need to make money after years of suffering
6. Lack of Water
![Page 24: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/24.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Top 10 Reasons Top 10 Reasons Tungsten Price Has IncreasedTungsten Price Has Increased
1. Demand (oil/coal/global/China growth)/ Supply Balance
Mines:
2. Shut for Environmental Adjustment
3. Purchased by new owners (Minmetals)
4. Miners realized they really control the market
5. Need to make money after years of suffering
6. Lack of Water
7. Lack of Electricity
![Page 25: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/25.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Top 10 Reasons Top 10 Reasons Tungsten Price Has IncreasedTungsten Price Has Increased
(continued)
8. Few new resources being developed
![Page 26: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/26.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Top 10 Reasons Top 10 Reasons Tungsten Price Has IncreasedTungsten Price Has Increased
(continued)
8. Few new resources being developed
9. No one believed the warning signs (lean craze)
![Page 27: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/27.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Top 10 Reasons Top 10 Reasons Tungsten Price Has IncreasedTungsten Price Has Increased
(continued)
8. Few new resources being developed
9. No one believed the warning signs (lean craze)
10. Speculators, greed
![Page 28: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/28.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Current Supply and Price SituationCurrent Supply and Price Situation
Supply chain from China to west is empty
![Page 29: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/29.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Current Supply and Price SituationCurrent Supply and Price Situation
Supply chain from China to west is empty
Consumer inventories are in general, low
![Page 30: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/30.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Current Supply and Price SituationCurrent Supply and Price Situation
Supply chain from China to west is empty
Consumer inventories are in general, low
Speculators still active/traders reenter the market
![Page 31: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/31.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Current Supply and Price SituationCurrent Supply and Price Situation
Supply chain from China to west is empty
Consumer inventories are in general, low
Speculators still active/traders reenter the market
Prices for YTO/BTO over $300 per MTU
![Page 32: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/32.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Current Supply and Price SituationCurrent Supply and Price Situation
Supply chain from China to west is empty
Consumer inventories are in general, low
Speculators still active/traders reenter the market
Prices for YTO/BTO over $300 per MTU
Near by shortage situation should remain until the fall
![Page 33: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/33.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Current Supply and Price SituationCurrent Supply and Price Situation
Supply chain from China to west is empty
Consumer inventories are in general, low
Speculators still active/traders reenter the market
Prices for YTO/BTO over $300 per MTU
Near term shortage situation should remain until the fall
No near term reason for prices to decline significantly
![Page 34: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/34.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
The DLA & Chinese National StockpileThe DLA & Chinese National Stockpile
The US DLA stockpile of tungsten, while huge, is of declining quality and of little benefit to most global tungsten concentrate consumers.
![Page 35: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/35.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
The DLA & Chinese National StockpileThe DLA & Chinese National Stockpile
The US DLA stockpile of tungsten, while huge, is of declining quality and of little benefit to most global tungsten concentrate consumers.
Releasing more material from the DLA is not a solution. Few can use it/time to market/no price relief.
![Page 36: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/36.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
The DLA & Chinese National StockpileThe DLA & Chinese National Stockpile
The US DLA stockpile of tungsten, while huge, is of declining quality and of little benefit to most global tungsten concentrate consumers.
Releasing more material from the DLA is not a solution. Few can use it/time to market/no price relief.
China has a stockpile. Is strategic in nature and not for market interventions.
![Page 37: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/37.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
The DLA & Chinese National StockpileThe DLA & Chinese National Stockpile
The US DLA stockpile of tungsten, while huge, is of declining quality and of little benefit to most global tungsten concentrate consumers.
Releasing more material from the DLA is not a solution. Few can use it/time to market/no price relief.
China has a stockpile. Is strategic in nature and not for market interventions.
Stockpiles are really bad for markets and producers.
![Page 38: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/38.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Results and ImplicationsResults and Implications
The costs of doing business has tripled. A container of Blue Oxide used to cost $200k, it now cost $600k.
![Page 39: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/39.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Results and ImplicationsResults and Implications
The costs of doing business has tripled. A container of Blue Oxide used to cost $200k, it now cost $600k.
Carbide companies failed to translate increasing raw materialprices into higher finished goods prices. A major increase incemented carbide prices needs to take place.
![Page 40: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/40.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Results and ImplicationsResults and Implications
The costs of doing business has tripled. A container of Blue Oxide used to cost $200k, it now cost $600k.
Carbide companies failed to translate increasing raw material prices into higher finished goods prices. A major increase in cemented carbide prices needs to take place.
Some companies could run out of material. However, where there is a high price, there is a way.
![Page 41: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/41.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Results and ImplicationsResults and Implications
The costs of doing business has tripled. A container of Blue Oxide used to cost $200k, it now cost $600k.
Carbide companies failed to translate increasing raw material prices into higher finished goods prices. A major increase in cemented carbide prices needs to take place.
Some companies could run out of material. However, where there is a high price, there is a way.
As the supply and demand remain close to balanced, price volatility will exists.
![Page 42: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/42.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Results and ImplicationsResults and Implications
The costs of doing business has tripled. A container of Blue Oxide used to cost $200k, it now cost $600k.
Carbide companies failed to translate increasing raw material prices into higher finished goods prices. A major increase in cemented carbide prices needs to take place.
Some companies could run out of material. However, where there is a high price, there is a way.
As the supply and demand remain close to balanced, price volatility will exists.
What goes up must come down- the bubble will burst.
![Page 43: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/43.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Results and ImplicationsResults and Implications
The costs of doing business has tripled. A container of Blue Oxide used to cost $200k, it now cost $600k.
Carbide companies failed to translate increasing raw material prices into higher finished goods prices. A major increase incemented carbide prices needs to take place.
Some companies could run out of material. However, where there is a high price, there is a way.
As the supply and demand remain close to balanced, price volatility will exists.
What goes up must come down- the bubble will burst.
License situation will be critical later in the year.
![Page 44: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/44.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
Results and ImplicationsResults and Implications
The costs of doing business has tripled. A container of Blue Oxide used to cost $200k, it now cost $600k.
Carbide companies failed to translate increasing raw material prices into higher finished goods prices. A major increase in cemented carbide prices needs to take place.
Some companies could run out of material. However, where there is a high price, there is a way.
As the supply and demand remain close to balanced, price volatility will exists.
What goes up must come down- the bubble will burst.
License situation will be critical later in the year.
LMB and other publications no longer reliable indicators of price.
![Page 45: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/45.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
SolutionsSolutions
1. Ore prices which justify future resource development.
![Page 46: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/46.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
SolutionsSolutions
1. Ore prices which justify future resource development.
2. Better Supplier / Consumer relationships.
![Page 47: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/47.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
SolutionsSolutions
1. Ore prices which justify future resource development.
2. Better Supplier / Consumer relationships.
3. Pricing structures which allow profitability at all levels.
![Page 48: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/48.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
SolutionsSolutions
1. Ore prices which justify future resource development.
2. Better Supplier / Consumer relationships.
3. Pricing structures which allow profitability at all levels.
4. More accurate mechanism for material pricing besides publication reports.
![Page 49: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/49.jpg)
Platts Steel & Ferroalloys Conference - June 2005
Zigong International Marketing, LLC
SolutionsSolutions
1. Ore prices which justify future resource development.
2. Better Supplier / Consumer relationships.
3. Pricing structures which allow profitability at all levels.
4. More accurate mechanism for material pricing besides publication reports.
5. As the cemented carbide industry consolidates into a few huge global companies and a smattering of regional companies, change will have to come in the supply chain.
![Page 50: Platts Steel & Ferroalloys Conference - 2005 Presented June 14, 15, 2005 by Zigong International Marketing, LLC 421 High Street, Fairport Harbor, OH 44077,](https://reader035.vdocument.in/reader035/viewer/2022062619/55182cc355034684678b4d08/html5/thumbnails/50.jpg)
Platts Steel & Ferroalloys Conference - 2005
Presented June 14, 15, 2005 by Zigong International Marketing, LLC421 High Street, Fairport Harbor, OH 44077, USA
Thank You!