Abstract: This paper briefly reviews the development历程 of China’s nonferrous metals industry since the founding of the People’s Republic of China and offers reflections and analyses on its development from 11 different perspectives. It concludes that, in the coming period, consumption of nonferrous metals will enter a “plateau phase,” making it extremely challenging to simultaneously achieve “steady growth” and implement the measures of “reducing overcapacity, destocking, deleveraging, lowering costs, and addressing shortcomings” (through coordinated production restrictions aimed at stabilizing prices). All cadres and employees across the industry must firmly establish the mindset that “maintaining stable operations is tantamount to ensuring survival,” and make every effort to prepare both mentally and materially for the reality that “the good days are gradually receding, while the tough times are just beginning.”

Keywords: Nonferrous Metals Industry; Development Patterns; Grasping; Respecting; Ensuring Steady Growth; Reducing Overcapacity; De-stocking; Maintaining Stable Operations; Safeguarding Survival

Chinese Library Classification: F420 Document Identifier: A Article Number: 11-5004 (2016) 2-00xx-x

The Central Economic Work Conference, held in Beijing from December 18 to 21, 2015, clearly pointed out that understanding the “new normal,” adapting to the “new normal,” and leading the “new normal” constitute the overarching logic guiding China’s economic development now and for the foreseeable future. At the same time, the conference laid out five key tasks for 2016: primarily focusing on reducing overcapacity, destocking, deleveraging, lowering costs, and addressing shortcomings. What should nonferrous metal enterprises do in 2016 and beyond? This is a pressing issue that urgently calls for collective discussion.

After briefly reviewing the development journey of China’s nonferrous metals industry since the founding of the People’s Republic of China, this article reflects on the development of the nonferrous metals industry from 11 different perspectives. It points out that, in the coming period, it will be extremely difficult for the nonferrous metals sector to simultaneously achieve “stable growth” and carry out “capacity reduction, inventory reduction, deleveraging, cost reduction, and addressing weak links” (through coordinated production restrictions aimed at stabilizing prices). All cadres and employees across the industry must firmly establish the mindset that “maintaining stable operations is tantamount to ensuring survival,” and make every effort to prepare both mentally and materially for the reality that “the good days are gradually receding, while the tough times are just beginning.” The author particularly emphasizes that this article represents solely personal views and hopes it will serve as a catalyst for further discussion; any shortcomings or inaccuracies are welcome to be critically examined and corrected.

Preface

Since 2002, when China’s output of ten commonly used nonferrous metals reached 10.12 million tons—surpassing the United States for the first time and rising to the world’s No. 1 position—both production and consumption have consistently remained at the top globally and have achieved leapfrog development. Since 2010, among the four major nonferrous metals—copper, aluminum, lead, and zinc, which account for more than 95% of the world’s total nonferrous metal output—China’s production and consumption have collectively accounted for roughly 40% of the global share, with an enormous cumulative consumption volume. At present, China’s consumption of nonferrous metals has moved beyond the period of high growth driven by making up for historical deficits; the growth in consumption from new sectors can hardly offset the rapid decline in traditional consumption areas due to technological advancements and the emergence of alternative materials. As China’s development model gradually shifts, its overall consumption of nonferrous metals is entering a “shock-induced downward phase” similar to what developed countries and regions have experienced in the past. However, given the large base size, there remains a risk of a sharp, cliff-like drop. China’s production and consumption patterns for nonferrous metals are steadily moving toward a new normal that increasingly aligns with those of developed countries and regions. Faced with an even more severe and complex domestic and international economic environment in the coming period, it is now imperative to firmly grasp and respect the inherent laws governing the development of the nonferrous metals industry and adapt to this new normal.

1. A Brief Review of the Development History of China’s Nonferrous Metals Industry in the New Era

The general preface of “60 Years of China’s Nonferrous Metals Industry in the New Era” clearly states: Since the founding of New China, China’s nonferrous metals industry has grown from small to large, gradually establishing a relatively complete industrial system entirely through its own efforts. Since the reform and opening-up, and especially since the beginning of the new century, the nonferrous metals industry has continued to develop rapidly, significantly enhancing its overall industrial strength. As a result, China has risen to become the world’s largest producer and consumer of nonferrous metals, markedly improving its standing among international peers and playing an increasingly important role on the global stage.

However, regarding the specific development process, here are several key milestones worth reviewing:

In the 1960s, in order to process the lead-zinc concentrates produced by the former Fan Kou Lead-Zinc Mine, the closed-blast furnace lead-zinc smelting technology patented by the British Imperial Smelting Corporation (commonly referred to as the ISP process) was adopted for the first time, leading to the construction of the former Shaoguan Smelter and laying a solid foundation for the development of China's lead-zinc industry. In January 1979, the former Guizhou Aluminum Plant signed a contract with the former Japan Light Metals Company for an 80,000-ton aluminum electrolysis plant. From November 27 to 30 of the same year, the former Fushun Aluminum Plant successfully completed the first industrial-scale trial run and went into production with a series of 23 135-kA prebaked anode electrolytic cells, thus ushering in a new era in the development of large-scale prebaked aluminum electrolysis technology in China. In the 1980s, the construction of the Jiangxi Copper Industry Company’s base—particularly the completion and commissioning of the GuiXi Smelter, the first copper smelter in China to adopt flash smelting technology—marked a major scientific and technological breakthrough in China’s copper industry. These key milestones effectively played a role in “focusing on the middle link (smelting) while boosting both ends (mining & beneficiation, and processing),” achieving twice the result with half the effort. They have greatly driven and promoted the substantial development of the entire nonferrous metals industry.

We should take a step back to thoughtfully examine and explore the development histories of the nonferrous metal industries in developed countries such as the United Kingdom, Japan, and the United States, so as to inspire new ideas for the development of China’s nonferrous metal industry under the new normal.

2 Currently, China’s output and consumption of nonferrous metals are enormous and unsustainable.

    跟踪分析2000 年以来《中国有色金属工业年鉴》公布的统计资料：2000 年我国精炼铜产量为137.11 万吨，是美国180.3万吨的76%，仅占全球总量的9.27%，或占除中国外世界前9 个生产国（智利、日本、美国、俄罗斯、赞比亚、印度、德国、韩国、波兰等）总产量的15.54%；到2014 年，我国精炼铜产量已达到764.91 万吨，是美国108.57 万吨的7 倍，占世界总产量的34.03%，或占除中国外世界前9 个生产国（智利、日本、美国、俄罗斯、印度、刚果民主、赞比亚、德国、韩国等）合计总产量的77.47%。2000 年我国精炼铜消费量为188.25 万吨，仅为美国297.9 万吨的63%，占世界总产量的12.46%，或占除中国外世界前9 个消费国或地区（美国、德国、日本、韩国、俄罗斯、意大利、巴西、印度、中国台湾等）总消费量的22.15% ；到2014 年，我国精炼铜消费量已达到945 万吨，是美国184.1 万吨的5.13倍，占世界总消费量的41.29%，是除中国外世界前9 个消费国或地区（美国、德国、日本、韩国、意大利、俄罗斯、中国台湾、土耳其、印度等）合计总量的1.28 倍。

Tracking and analyzing data related to industries such as electrolytic aluminum (primary aluminum), refined lead, and refined zinc reveals not only similarities with the refined copper industry but also the finding that, since the beginning of the 21st century—particularly since 2010—global production and consumption of copper, aluminum, lead, and zinc have generally remained “stagnant,” once Chinese factors are factored out. Assuming that from 2016 to 2025, China’s refined copper consumption remains steady at nearly 10 million tons per year—consistent with the level in 2014—for a total of 100 million tons of refined copper consumed over this 10-year period, where exactly will this 100-million-ton volume of refined copper be allocated across specific sectors and forms of consumption? This is a question worthy of deep reflection and careful consideration. Similar issues also apply to aluminum, lead, and zinc.

3. China’s consumption of nonferrous metals could potentially be “halved.”

Take refined zinc as an example: In 2000, China’s consumption of refined zinc was 1.35 million tons, roughly equivalent to the U.S. figure of 1.348 million tons. This accounted for only 15.18% of global total consumption—or, in other words, just 30.57% of the combined consumption of the world’s top nine consuming countries or regions excluding China (including the U.S., India, South Korea, Japan, Germany, Belgium, Brazil, Italy, and Taiwan, China). By 2014, China’s refined zinc consumption had surged to 6.35 million tons—6.6 times the U.S. consumption of 962,000 tons—and accounted for 46.25% of global total consumption. This figure was also 1.46 times the combined consumption of the world’s top nine consuming countries or regions excluding China (including the U.S., India, South Korea, Japan, Germany, Belgium, Italy, Taiwan, China, and Brazil). Suppose that by 2025, China’s refined zinc consumption intensity per unit of GDP reaches the average level of the world’s top nine consuming countries or regions excluding China as of 2014. Under such a scenario, China’s refined zinc consumption could potentially be halved compared to its 2014 level.

The possibility of a “halving” in China’s nonferrous metal consumption is no exaggeration. According to data from the annual “China Nonferrous Metals Yearbook” for relevant years, since the beginning of the 21st century, U.S. refined copper consumption has been on a general downward trend after peaking at 3.2003 million tons in 2004, falling to just 1.841 million tons in 2014—a decline of 42.47%. Refined aluminum consumption (including electrolytic aluminum or primary aluminum) has also been declining since reaching a peak of 6.15 million tons in 2006, dropping to 5.2501 million tons in 2014, a decrease of nearly 15% (or 36.97% when compared with the 3.8762 million tons recorded in 2009). Refined zinc consumption has fallen from a peak of 1.348 million tons in 2000 to 962,000 tons in 2014, representing a decline of nearly 30%. Only refined lead consumption has remained relatively stable, hovering between 1.4 million and 1.7 million tons.

Any new technological revolution will have a profound impact on the traditional consumption of nonferrous metals. For example, the widespread use of optical cables and the rapid advancement of wireless communication technologies have significantly reduced the market for copper-based coaxial cables. We must pay particular attention to research and analysis on the potential major impact that the “Internet Plus” initiative could have on China’s consumption of nonferrous metals. “Internet Plus” will substantially increase the utilization rate of existing technological equipment and minimize nonferrous metal consumption caused by idle equipment and facilities.

4. China is the world’s largest producer and consumer of non-ferrous metals and cannot be replaced.

China is, has been, and will forever remain the world’s largest producer and consumer of nonferrous metals. This reality is determined both by China’s specific national conditions and by the inherent laws governing the development of the nonferrous metals industry. Although China’s reserves of nonferrous metal minerals are relatively modest in terms of quality, they remain abundant and possess significant potential for comprehensive utilization. Moreover, the Chinese people are diligent and highly resourceful, demonstrating a remarkable spirit of resilience in the face of adversity and an unwavering commitment to achieving “self-sufficiency.” Even if production and consumption were to be halved from their 2014 levels, the scale of China’s nonferrous metals production and consumption in the future would still be unmatched by any other country or region.

5. Prices of non-ferrous metals still have room to fall.

The global oversupply will inevitably squeeze to the greatest extent the previously inflated costs and profits—a situation that is an objective necessity for seizing a limited share of the market, and one that will not be altered by anyone’s will. The “unrelenting decline” in international oil prices and the ongoing difficulties facing China’s domestic electrolytic aluminum industry are both stark real-world examples that we must take to heart.

The widespread decline in bulk commodity prices will further reduce the production costs of nonferrous metals. As is well known, for every 1-cent decrease in electricity prices, the production cost of electrolytic aluminum drops by at least 140 yuan per ton. In the coming period, given that China is the world’s largest producer and consumer of nonferrous metals—and a position that cannot be easily replaced—China’s “average production costs, RMB exchange rate, and tax rates” for nonferrous metals will become the benchmark for pricing in the global nonferrous metals market.

“De-stocking and cost reduction” itself is a painful process that continuously drives down the “average production cost across the entire society” and the “overall profitability of the entire industry.” A direct manifestation of this is the gradual reduction in the losses of loss-making enterprises and the shrinking of the relative profit margins of profitable enterprises.

6. The nonferrous metal mining, beneficiation, and smelting industry is a heavy-metal-polluting industry.

The five key heavy-metal pollutants nationwide are lead, mercury, cadmium, chromium, and the metalloid arsenic, with lead being the most prominent among them. Mercury is also one of the “ten commonly used nonferrous metals” included in statistical surveys. Mercury, cadmium, chromium, and the metalloid arsenic typically occur jointly or as associated byproducts with copper, aluminum (bauxite), and lead-zinc mineral resources. Mercury is a major byproduct of lead-zinc mining, while the metalloid arsenic is a primary byproduct of copper mining. The “12th Five-Year Plan for Comprehensive Prevention and Control of Heavy-Metal Pollution,” approved by the State Council in 2011, explicitly identifies five major industries—nonferrous metal mining and beneficiation, smelting, lead-acid batteries, leather and leather products, and chemical raw materials and their products—as priority sectors for heavy-metal pollution prevention and control.

Starting in October 2006, under the leadership of the Party Central Committee and the State Council, census agencies at all levels drew on elite personnel and experienced professionals from environmental protection agencies, agricultural systems, and relevant institutions to form a census team comprising more than 570,000 census takers and census supervisors. This team conducted an unprecedented large-scale household registration, survey, and verification of 1.576 million industrial sources, 2.899 million agricultural sources, 1.446 million domestic sources, and 4,790 centralized pollution control facilities, thereby obtaining first-hand environmental pollution data from over 1.1 billion pollution sources... Building on this foundation, Wang Yuqing, former Deputy Director of the former State Environmental Protection Administration and Director of the Office of the Leading Group for the First National Pollution Source Census under the State Council, organized relevant experts to compile the "Handbook of Emission Coefficients for Pollution Source Census" (Volumes I, II, and III; published and distributed by China Environmental Science Press in September 2011). Relevant data indicate that the nonferrous metal mining and smelting industry is not only a major source of heavy-metal pollution but also one of the primary culprits behind the formation of smog and haze.

7. The development of the nonferrous metals industry follows its own objective laws.

Nonferrous metals are both indispensable and, as technology advances and substitution deepens, exhibit the characteristics of decreasing per-unit consumption and increasing cumulative recyclability. Not only are nonferrous metals essential to people’s daily work and life, but they are also critical to national security, defense industries, and aerospace applications.

Nonferrous metals possess excellent recyclability characteristics. During the recycling process, aside from minor losses due to entrainment and burn-off, the utilization rate can exceed 95%. Moreover, these metals exhibit highly stable physicochemical properties, and their energy consumption and pollutant emissions are significantly lower than those associated with the production of primary metals. Relevant data show that between 2001 and 2011, the share of recycled lead in total global lead production rose from 58.7% to 71.1%; meanwhile, the output of primary lead (mined lead) declined from 2.234 million tons to 1.559 million tons—less than half of China’s primary lead production of 3.244 million tons for the same year. In 2013, China’s output of refined copper, aluminum, and refined lead from recycling was comparable to the United States’ consumption levels for those metals in the same year.

It possesses “toxic” properties. On the one hand, the vast majority of nonferrous metal mineral resources are associated with the “five key heavy metal pollutants,” and during the production process, some toxic and harmful substances are unintentionally generated and released. On the other hand, almost all nonferrous metals, when used excessively or improperly, can enter the food chain through various pathways, causing harm to human health and the surrounding environment. The European Union has already adopted relevant regulations (such as the REACH Regulation) to standardize and restrict the use of nonferrous metals.

They possess excellent transportability and certain financial derivative characteristics. Nonferrous metals are valuable and dense (with small volume), and they exhibit properties such as corrosion resistance. As internationally traded standardized commodities, they are highly convenient for long-distance transportation (high liquidity). Although the “Bretton Woods” international financial system has been in disarray for nearly 40 years, since the Asian financial crisis—and especially following the outbreak of the global financial crisis—gold’s financial attributes have gradually made a comeback, and the financial derivative characteristics of nonferrous metals, particularly copper and aluminum, have also become increasingly active.

Since the beginning of the 21st century, as global cumulative consumption of nonferrous metals has risen and supply has gradually become more abundant, their strategic value has been diminishing. In developed countries and regions, the production and consumption of nonferrous metals are primarily met through recycling, maintaining overall volumes relatively stable over the long term. Meanwhile, less-developed countries and regions—especially those endowed with abundant mineral resources—have become major producers of nonferrous metals, and a clear disconnect has emerged between mineral-based production and actual consumption.

8. The core of “reducing overcapacity” is to prohibit any form of new capacity expansion.

What is the essence of overcapacity? And how has the implementation of the Central Government’s “Eight-Point Regulations” helped alleviate overcapacity in the high-end catering industry? These are questions worth pondering. At its core, overcapacity reflects the mismatch between the enormous influence wielded by central enterprises and their relative lack of competitiveness. Objective facts show that over the past 30-plus years of reform and opening-up, the more thoroughly a competitive industry has undergone reform and opening-up—and the smaller the share of state-owned enterprises, especially central enterprises, in that industry—the less severe the problem of overcapacity has become; conversely, the opposite holds true. Therefore, the effort to reduce overcapacity must be carried out in accordance with the overarching requirement of “comprehensively deepening reform,” taking the active development of a mixed-ownership economy as a starting point and striving to simultaneously implement “prohibitions, retreats, and reductions.” We must innovate, based on actual conditions, the closure and bankruptcy models previously used by enterprises such as the former Shenyang Smelter and the Shanghai Smelter. We need to summon the same courage and determination shown during the earlier phase of “reducing textile capacity,” strictly enforce the law, and effectively eliminate “zombie enterprises.”

It is imperative to prohibit all forms of new capacity expansion, especially the construction of new smelting facilities. The severe overcapacity in primary aluminum production is primarily attributable to the failure to effectively curb the addition of new capacity. Other industries must avoid repeating this mistake. Currently, the recycling copper and lead industries are also facing significant operational and financial difficulties, largely because they have gone against the natural laws of industrial development. Without establishing effective channels for securing raw materials, these industries have recklessly pursued large-scale expansion of smelting capacity under the pretext of developing a circular economy, thereby bringing about disastrous consequences.

Against the current backdrop of “reducing overcapacity” and “de-stocking,” environmentally-driven relocation is a dead end, and there are hardly any precedents for it even in developed countries and regions. First, such relocations would create new sources of pollution; second, it’s extremely difficult to ensure that relocations happen synchronously—often, companies relocate without actually moving their operations, thereby exacerbating the problem of temporary overcapacity; third, since implementing these relocations requires massive investment, even if successful, the relocated facilities would still lack competitive edge. We must respect and grasp the inherent laws governing the development of the nonferrous metals industry, learn from China’s profound lesson in Xinjiang, where large-scale electrolytic aluminum plants were built but capacity remained “shifted but not relocated.” We must strictly guard against using the implementation of the “Belt and Road” initiative as an excuse to launch new nonferrous metal smelting projects in relevant countries, thereby further aggravating global overcapacity in smelting.

9. Does “de-stocking” include reducing foreign exchange reserves?

Although the inclusion of the renminbi in the Special Drawing Rights (SDR) basket and the official launch of the Asian Infrastructure Investment Bank (AIIB) have created more favorable and relaxed conditions for converting China’s massive foreign exchange reserves, the increasingly frequent and severely expanding smog, coupled with the ever-growing size of these reserves, are still widely regarded as major factors hindering the enhancement of the Chinese people’s sense of “well-being and fulfillment in life.” The gradual easing of global nonferrous metal supply not only provides China with numerous options for securing strategic supply through diversified channels, but also gradually erodes the international competitiveness of China’s nonferrous metal industry—previously underpinned by domestic demand, low labor costs, and minimal environmental investment.

Based on the closing prices of LME three-month copper at USD 4,690 per ton, aluminum at USD 1,540.5 per ton, lead at USD 1,744 per ton, and zinc at USD 1,549 per ton from December 21 to 25, 2015, if China were to timely acquire and stockpile—through various means over a certain period—the 1.841 million tons of copper, 5.2501 million tons of aluminum, 1.671 million tons of lead, and 962,000 tons of zinc consumed by the United States—the world’s second-largest consumer of nonferrous metals in 2014—it would still only be able to convert its foreign exchange reserves of over 20 billion U.S. dollars into physical reserves of nonferrous metals totaling less than 10 million tons. This approach would be far more convenient and safer than stockpiling oil, and it could also provide a more diversified guarantee for China’s strategic energy and nonferrous metal supply security. For China’s existing massive foreign exchange reserves, such an effort would represent merely “a drop in the ocean.” Even if this assumption were implemented only partially, it would nonetheless have profound implications for the global production and consumption patterns of nonferrous metals. Therefore, key manufacturing enterprises must carefully study and closely monitor this development.

10. Ensure the strategic security of nonferrous metal mineral resource supply.

The nonferrous metals industry is a fundamental raw materials industry, and its mining sector is undoubtedly the very foundation of that foundation. “If the foundation is unstable, even the earth will shake.” Upholding the red line for ecological civilization construction in the nonferrous metals mining sector and firmly safeguarding the strategic security of mineral resource supply should become a shared consensus across society.

Due to the inherent scarcity of nonferrous metal mineral resources in our country, coupled with other human-induced factors, the nonferrous metal mining industry is currently facing multiple pressures: volatile and declining international market prices, a gradual deterioration in ore grades, and steadily rising labor and environmental protection costs. There is an urgent need for comprehensive national support to help the industry achieve green, efficient, and circular development and utilization. Should China’s nonferrous metal mining sector experience a full-scale collapse in the short term, it would not only hinder the progress of building our nation into a global powerhouse in the nonferrous metals industry but also push millions of people from “old, remote, border, and impoverished” regions—those who have already lifted themselves out of poverty through mining—back into poverty. We simply cannot afford such a scenario!

In China, the nonferrous metals mining industry as a whole suffers from a shortage of copper and nickel, and our dependence on foreign sources for these two minerals has remained persistently high over the long term. Consolidating domestic development of copper and nickel mineral resources while appropriately scaling back the development of lead and zinc mineral resources will not only help ensure the sustained and stable operation of China’s nonferrous metals mining sector but also enable us to make better use of “two types of resources and two markets” both domestically and internationally. This approach will further contribute to improving the ecological environment and promoting coordinated development of the nonferrous metals industry. Moreover, the substantial quantities of nonferrous metals that China has already accumulated are gradually entering a phase of recycling. By vigorously developing the urban mining industry, we can achieve multiple benefits—expanding employment, protecting the environment, and reducing the intensity of domestic mineral resource exploitation at its source—all in one fell swoop.

The country should seize the current opportunity and stockpile as much indium, gallium, and other rare and dispersed metals that are often found in association with other minerals. Once China’s nonferrous metal industry transitions to a development model—similar to that of developed countries and regions—that emphasizes circular utilization, the indium and gallium currently regarded as burdens will become scarce resources.

11. Vigorously promote military-civilian integration and strengthen supply-side structural reform.

In the era of big data, “Internet Plus” and intelligent manufacturing will deeply permeate every aspect of the nonferrous metals processing industry. We must adopt a more proactive, enterprising, and open mindset, and strive to create favorable conditions for the integration of military and civilian sectors, thus achieving shared development. The fact that China’s “Shenzhou” spacecraft can reach into space, the “Jiaolong” submersible can dive into the deep sea, and the “Yutu” lunar rover can explore the moon clearly demonstrates that China is fully equipped with advanced, high-precision, and cutting-edge nonferrous metal materials, as well as sophisticated processing technologies and equipment. Strengthening the integration of military and civilian sectors is an inevitable choice for breaking through bottlenecks in the R&D, industrial production, and application of “high-end, precise, novel, and advanced” products. This approach can achieve twice the result with half the effort; otherwise, it would only lead to unnecessary expenditure of resources and manpower.

The 2015 Central Economic Work Conference emphasized that, in 2016 and for the period ahead, while moderately expanding total demand, we must focus on strengthening supply-side structural reform and implementing five mutually complementary policy pillars. The entire industry should seize this opportunity to take immediate action, pursue bold reforms, dare to innovate, liberate our minds, seek truth from facts, keep pace with the times, and, guided by the development philosophy of “innovation, coordination, green development, openness, and shared benefits,” reinforce industry self-discipline, step up coordination among enterprises in supply-side structural reform, strive to correct distortions in factor allocation, expand effective supply, enhance the adaptability and flexibility of the supply structure, and improve total-factor productivity.

The nonferrous metals smelting industry occupies a pivotal position—serving as both the link between upstream and downstream sectors—in the industry-wide “supply-side structural reform.” It is also an inevitable choice for addressing severe market challenges and maintaining market order. Upstream, it can influence the order of domestic and international mineral resource development and enhance bargaining power over processing fees. Downstream, it can reduce intermediate sales links, accelerate the restructuring of processing enterprises, boost total-factor productivity, and expedite the shift toward a development pattern in which primary-product processing becomes concentrated in leading smelting enterprises or bases, while independent processing firms rely on primary-processed products supplied by these key smelting enterprises to carry out further processing, thereby meeting the needs of end-users.

12. To address our shortcomings, we must work together in unison to ensure stable operations.

To address our weak links, we must work together in unison to ensure stable operations. First, all enterprises must attach great importance to safety production and environmental protection, fill these gaps, and guarantee both safety in production and environmental safety; otherwise, they will simply be unable to survive, and any talk of progress would be mere empty rhetoric. Second, we must strive to leverage China’s leading position in the global nonferrous metal smelting industry. Taking the opportunity presented by supply-side structural reform, we should strengthen industry self-discipline, avoid vicious competition, effectively counter malicious short-selling challenges, and uphold market order. Third, the leadership teams of each unit (enterprise) must pull together, lead their staff and workers with practical action and determination, and overcome difficulties head-on. Fourth, all employees across the industry must enhance their sense of ownership, pool their collective wisdom and efforts, and weather this tough period together. There are no industries that have collapsed—only individual enterprises that have failed. All employees across the industry must firmly embrace the mindset that “stabilizing operations means ensuring survival.” We must carefully summarize and learn from the lessons of China’s investment in domestic and overseas nonferrous metal projects since the global financial crisis, diligently grasp and respect the inherent laws governing the development of the nonferrous metal industry, and keep a tight rein on financial resources. We must make every possible effort to prepare both spiritually and materially for the reality that “the good times are gradually receding, while the hard times have just begun.”

References

[1] Editorial Department of the Annual of Nonferrous Metals of China. Annual of Nonferrous Metals of China, 2000–2014 [D]. Beijing: China Nonferrous Metals Industry Association, 2000–2014.