MgO Industry is Facing Top Three Pressures

December 5, 2017 | Author: | Posted in Business

   At present, magnesium oxide yield is increasing step by step steadily, the market competition is sharpening. The analyst, who is from a professional magnesium oxide supplier and manufacturer, points out, “at present, the magnesium oxide manufacturers are facing three top pressures which is intensifying: the high cost of raw material, low downstream demand, and the market competition brought by increasingly capacity.” what’s more, it also leads to the earning power of magnesium oxide industry chain decreases drastically.

High Pressure of Raw Material Cost

The raw material of magnesium oxide is the the main factor to affect magnesium oxide cost. Raw material occupies 70 percent to 75 percent of the total cost, or occupies more percent. However, restricted by resources and technology, Chinese magnesium oxide equipment mainly uses magnesium hydroxide as raw material at present.

High Pressure of Market Requirement

Because be limited by market and technology, at present, generally speaking, the down-stream products of domestic magnesium oxide are rubber, medicine, food and other industries. Among these products, the rubber product occupies about 60 percent of downstream consumption structure. Affected by sluggish global economy, domestic chemical market turns to depression, especially the rubber industry. Along with it, magnesium oxide market profit ability is decreasing. Influenced by downturn downstream demand, the quantity demanded and operating rate of domestic magnesium oxide also dramatic decline.

High Pressure of Industrial Competition

In the past two years, a group of newly built, renovation and expansion magnesium oxide projects is promoted rapidly. And most of them are large scale magnesium oxide project. The increasing capacity leads to intensifying competition.

With the improvement of the market, the operating rate of domestic magnesium oxide equipment is increasing as well. However, the three pressure are still huge in the future. As a professional magnesium oxide manufacturer and supplier, the shoulder is still heavy responsibilities.

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