Asian Metal: Good day, Mr. Bin. Thank you for granting this interview. Could you please make a brief introduction of your company?

Bin: Zhuzhou Smelter Group, with 7 subsidiaries, two branches, one national technology centre and one import & export company, was founded in January, 2002. We mainly produce Zn, Pb and the alloys, recycling Cu, Ag, Bi, Te, Cd, In and sulfuric acid comprehensively. In addition, we also produce and sell high purity Ga, As, In, P, Sn, Te, Se, Zn, Cd of above 5N. To sum up, Zhuzhou Smelter Group produces 420,000t of nonferrous metals and 300,000t of industrial sulphuric acid every year.

As one of the leading Chinese cadmium ingot producers, our annual output of cadmium ingot 99.99%-99.994% is 1,400-1,640t now, and we are mainly selling the material to Chinese domestic cadmium oxide and storage batteries producers.

Asian Metal: How do you think of production and demand for Chinese cadmium ingot so far this year?

Bin: Apart from Huludao Zinc Smelter, Zhuzhou Smelter and other Chinese leading cadmium ingot producers, a number of medium and small sized producers have emerged in Chenzhou, Hunan Province and other areas in the recent few years. However, as the government conducts severe environmental inspections and downstream industries are performing inactively, many producers have ceased or reduced production as of Q2. Therefore, it is predicted that outputs of Chinese domestic producers will decrease compared with last year. On the demand side, mainstream end users from industries like cadmium oxide and storage battery reduced purchasing quantity of cadmium ingot in the past months, being also affected by the environmental inspections.

Asian Metal: What is the proportion of Chinese domestic cadmium ingot outputs again the import goods?

Bin: In my opinion, the proportion is about 50%:50% now. And the biggest advantage of Chinese domestic cadmium ingot remains the higher quality of the products, while the import goods are more competitive on prices.

Asian Metal: Chinese cadmium ingot 99.99% prices decreased continuously in July and August, and hit a historical low level of RMB15,800-16,300/t (USD2,582-2,663/t) in early September. Do you think the prices have seen the bottom?

Bin: Actually, most Chinese cadmium ingot producers are selling at a loss now, as the average costs keep firm at RMB18,000-19,000/t (USD2,941-3,105/t). Therefore, I do not think there is still room for the price to decrease.

Asian Metal: So do you expect Chinese cadmium ingot market to make substantial improvements in September and October?

Bin: I believe that demand for cadmium ingot from Chinese end users will turn better in September and October, who should purchase the material and do preparation for production in Q4 of this year. But the price changes will mainly depend on supply and costs of import goods. And it is difficult for the prices to increase to the level of RMB18,000/t (USD2,941/t) in the coming months as the overall business conditions remain unsatisfactory.

Asian Metal: We appreciate your support giving us your valuable time and we wish a bright future for Zhuzhou Smelter Group.