The 2011 Annual Meeting of the Asia-Pacific Laterite Nickel Ore Cooperation Organization was held in Shanghai on April 22. It was revealed at the meeting that from this year onwards, the organization will formally establish a professional technical committee of nickel and iron, and establish a long-term and fixed exchange and trading platform.

It is understood that at present, more than half of the production capacity of ferronickel enterprises in China is controlled by stainless steel enterprises. What triggered the enthusiasm for the construction of stainless steel plants? According to the survey, the deep-seated reason is that my country has changed from a stainless steel importer to an exporter, and the output of mainstream stainless steel products has increased by a considerable scale compared with previous years. Since 300 series stainless steel purchases a large amount of nickel and iron for production, reducing costs and actively competing have become the magic weapon for stainless steel enterprises. The acquisition and restructuring of ferronickel enterprises is the most convenient way to reduce costs. The powerful ferronickel enterprises intend to develop downstream to form a complete stainless steel industry chain.

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The concerted efforts of upstream and downstream have led to the rapid expansion of domestic ferronickel production capacity. According to statistics from Shanghai Nonferrous Metals Network (SMM), the domestic ferronickel production capacity was 214,000 tons in 2009, and expanded to 338,000 tons in 2010. In 2011, this figure will reach 368,000 tons. Including the unopened 150,000 tons of ferronickel production capacity in China, the total production capacity of ferronickel in 2011 is expected to reach 518,000 tons, a year-on-year increase of 53%.

Although the investment enthusiasm of industrial capital has made the entire industry show a thriving status quo, but with the strengthening of anti-dumping efforts on Chinese stainless steel in the international market, the problem of excess capacity will gradually surface. In mid-April, it was reported that the Ministry of Finance was planning to cancel the current 5% export tax rebate for stainless steel bars, rods, shapes, and wires. Although the above-mentioned commodities account for a small proportion of stainless steel products, it does not rule out the possibility that the country will expand the scope of commodities when it formally issues documents. In fact, regardless of the policy influence, it is reported that the theme of the summit is "coordinated development and win-win cooperation". To this end, the organizing committee plans to hold a professional conference on property rights transactions in Nanjing this autumn.