RHI Magnesita invests in Chinese dolomite plant in Chizhou

This is part of a decisive response to address global pressures in the supply of raw materials to the refractory industry and provide additional volumes to its customers worldwide.

The Chizhou site includes an extensive dolomite mine and raw material production, as well as facilities for the production of high-quality dolomite-based finished products. Successful trials are already underway in the brick plant in Chizhou where production is planned for 1Q19. The raw dolomite mine is planned to resume operation by the end of 2019. This overall investment will eventually lead to the creation of up to 250 jobs.

"One of the reasons for the merger of RHI and Magnesita last year was to create a global leader in the refractory industry capable of capitalising on growth potential including in China and Asia," said Stefan Borgas, CEO of RHI Magnesita. "After a detailed analysis of the global supply situation for refractory raw materials, as well as of our own production and supply chain, we have taken swift and decisive action to invest above €20 million in the Chizhou site in China, further enhancing our leading global market position. After the completion of the investment, RHI Magnesita will be able to offer a fully integrated dolomite source in each of the big regions of the world to our customers and simultaneously offer dual sourcing options."

The refractory industry as a whole is currently facing a number of challenges, particularly in relation to the supply of basic raw materials. Stricter environmental regulations in China have led to local plant closures, resulting in shortages of both magnesite and dolomite, dramatic increases in raw material cost, and supply security issues. These developments have accelerated the shift from magnesia to dolomite based products. The all-time high in stainless steel production has further fuelled demand for refractory products and compounded the pressure on raw material supplies, creating challenges for all market participants.

With the investment in Chizhou, RHI Magnesita ensures long-term production cost security. 90% of local dolomite producers do not benefit from the significant advantages of owning their own sources of raw material supply. RHI Magnesita will offer fully integrated dolomite production in China. The Chizhou dolomite mine is considered in quality terms one of the best mines in China and the location in the Anhui Province is located very close to RHI Magnesita’s largest key customers and steel producers.

Marco Olszewsky, President China at RHI Magnesita, stated that customers will benefit from: “The increased availability of our own raw materials is crucial and enables us to guarantee not only the security of supply but also consistently high product quality. We are confident that our Chinese and Asian customers will benefit from even shorter supply routes and better customer service.”

Read the article online at: https://www.worldcement.com/asia-pacific-rim/26062018/rhi-magnesita-invests-in-chinese-dolomite-plant-in-chizhou/