November 1st, 2025
CCM Market Insight (October, 2024)
Raw material supply:
From view of policy, since April/May 2024, the govenment strictly control the mining quantity, over-mining is absolutely prohibited.
In Haicheng area, the mines have stopped mining in April/May because their total amount of mining has reached the annual limit that the govenment approved.
Dashiqiao is relatively lax in policy implementation, the mines there continued to mine even after exceeding the mining limit, and also some unlicensed mines conducted some illegal mining activities.
There was still ore continuously being sent into the market at that time, so there was no abvious ore shortage.
Since August, ore control in Dashiqiao area also became extremely strict, over-mining has been mandatorily stopped, individuals who did illegal mining are fined and caught, many enterprises have been shut down according to law.
This leads to a sharp shortage of ore supply, uneven ore quality and increased ore prices.
It's said that some large-scale enterprises have stockpiled huge quantities of ore before the mining restriction began and still have surplus.
But they don't want to sell to the market now in order to push up prices again and again to make more profits.
On the other hand, the government would not open up more mining quantity until these stocks are used up.
And the ore control in 2025 will only become more strict according to the current situations and the general policy trend.
Therefore, it can be predicted that the tensen of ore supply will last at least to the end of 2024, product price will keep increasing.
Production capacity replacement:
Only enterprises whose production capacity is over 100,000 tons can apply for capacity replacement (with 1.4 tons of original capacity to replace for 1 ton of new capacity).
For enterprises with less than 100,000 tons production capacity, they need to integrate with other enterprises to reach the minimum capacity for replacement.
And also they need to meet the other replacement conditions, like funds and technology for kiln renovation, etc.
This will make many small enterprises shut down because they have no enough ability to fulfill the capacity replacement conditions.
The govenment requires all capacity replacement should be completed by the end of 2025.
Price trend:
Up to the end of October, the finished product price for CCM 85%/87%/90% powder has been increased by about RMB100/ ton compared to August before the strict ore control.
