China's tungsten industry macro-control policies and effects in recent years

Tungsten is a dominant mineral classified by China as a protective mining. In order to curb the occurrence of excessive mining, destruction of the environment, waste of resources, and to protect the dominant position of tungsten resources in the world, in recent years, the state has issued a series of macro-control policies regulating the development of the tungsten industry. It has played a good role in the healthy development of the tungsten industry, not only protecting China's tungsten resources, but also improving China's right to speak in the industry.

First, the status quo of China's tungsten industry

According to the US Geological Survey, the world's tungsten reserves in 2008 were 3 million tons, and the reserves were 6.3 million tons. Among them, China's tungsten reserves are 1.8 million tons, and the reserve base is 4.2 million tons, accounting for 60.0% and 66.67% of the world, respectively, ranking first in the world; other tungsten resources are mainly distributed in Canada, Russia, the United States, Bolivia, Austria and Portugal. Waiting for the country.

China is the world's largest producer and exporter of tungsten concentrates. Since 2002, China's tungsten concentrate production has remained at around 85% of the world's total output (see Table 1). According to the current mining speed, the static guarantee of tungsten in China is only 14 years, and the resource advantage has ceased to exist. According to the non-ferrous metal industry association statistics, in 2008 China's tungsten concentrate production of 84 500 t, an increase of 5.01% over 2007; tungsten industry sales income of 39.1 billion yuan, up 35.6 billion yuan in 2007, an increase of 9.38%, the industry profit 38.47 100 million yuan, down 43.03% from 6.74 billion yuan in 2007; China's tungsten resources are mainly distributed in Jiangxi and Hunan provinces. In 2008, the output of tungsten concentrates in the two provinces was 36,900 tons and 24,600 tons, respectively. 80.0% of the country's total output.

Table 1 World and China's tungsten concentrate production and ratio from 2002 to 2008

Second, China's tungsten industry's macro-control policies

(1) Strengthening industry management and improving access thresholds

To rectify the order of tungsten ore resources development, to combat illegal mining of stealing, to promote the healthy development of tungsten industry, the State Council in July 2005 forwarded by seven ministries jointly developed "on the strengthening of tungsten, tin and antimony industry management" ([2005] Circular 38). The "Opinions" pointed out that it is necessary to strengthen the supervision and management of the industry, regulate the order of mining, smelting, processing and domestic and foreign trade in the industry; further improve the industry access system, and rectify the order and operation order of tungsten mining. In December 2006, the National Development and Reform Commission announced the entry conditions for the tungsten industry, stipulating that in addition to achieving a certain scale of production, production enterprises must meet the specified requirements on energy consumption and environmental protection. At the same time, it has also made strict regulations on the establishment and layout of production enterprises, production scale and process equipment, resource recycling and energy consumption, environmental protection and product quality. This has greatly increased the barriers to entry for the tungsten industry and prevented companies with backward technology and small scales from entering the industry.

(2) Stopping the tungsten mining license and rectifying the mining order

In 2002, in order to rectify the order of tungsten ore development, the state suspended the issuance of tungsten mining licenses and prevented further expansion of tungsten mining. In 2008, the Ministry of Land and Resources and other nine ministries and commissions jointly launched a national “review” action to rectify and standardize the development of mineral resources, seriously investigated and dealt with various illegal and illegal activities in the field of tungsten mineral resources development, and standardized the healthy development of tungsten mine development enterprises. It has cracked down on the phenomenon of stealing and stealing.

(3) Implementing the total mining control and export quota management system

In response to the phenomenon of declining market prices, oversupply of products and vicious low-price competition, China has implemented a total mining control and export quota management system for the exploitation and export of tungsten products. In order to suppress the disorderly mining of tungsten ore, since 2002, the country has established the total amount of tungsten ore mining each year and has released the mining indicators to various provinces. Similarly, quota management is also applied to the export of tungsten ore, and the total amount of exports is controlled (see Table 2).

Table 2 Total amount of tungsten mining and export quotas in China from 2003 to 2009

(4) Adjusting export tax rebates and tariff rates to increase export costs

In order to protect tungsten resources and reduce exports, since 2004, China has adjusted export tax rebates and tariff policies five times. Since January 1, 2004, the 13% export tax rebate policy for tungsten concentrate and tungsten waste has been cancelled. Since January 1, 2005, the tungsten and iron export tax rebate policy has been abolished; since May 1, 2005, tungsten products have been eliminated. The export tax rebate rate of ammonium paratungstate, tungsten oxide, tungsten powder and tungsten carbide powder is reduced from 13% to 8%. From January 1, 2006, the export tax rebate for tungsten products will be reduced from 8% to 5%; from January 1, 2008 The export tariff rate of tungsten iron increased from 10% to 20%. The adjustment of this series of tariff policies has increased the export cost of tungsten products, reduced exports, and effectively protected China's tungsten resources.

(5) Raising resource taxes and increasing the cost of tungsten mining

In order to further improve the efficiency of resource utilization, fully reflect the scarcity of tungsten resources, and achieve sustainable development of tungsten resources, the Ministry of Finance and the State Administration of Taxation issued a notice (Cai Shui [2007] No. 100), starting from August 1, 2007. The tungsten ore resource tax is adjusted by the applicable tax standard. The previous three, four, and five levels of tungsten ore resource tax are 0.6 yuan/t, 0.5 yuan/t, and 0.4 yuan/t (tungsten ore ore), which are now adjusted to 9 yuan. /t, 8 yuan / t, 7 yuan / t (tungsten ore ore), respectively, 15 times, 16 times and 17.5 times the yuan standard. This has greatly increased the mining cost of tungsten ore and has hit the phenomenon of indiscriminate mining.

(6) Eliminating the tungsten processing trade policy and integrating the tungsten ore import and export trade enterprises

In the face of the export quota management measures adopted by the state, some tungsten mine enterprises have engaged in the export of tungsten products in disguise through the form of processing trade, which has seriously disrupted the trade of tungsten products in China. In this regard, the Ministry of Commerce and the General Administration of Customs issued an announcement in August 2005, calling for the processing trade of tungsten ore and its concentrates, effectively combating the previous exchange of tungsten products with tungsten sand, engaging in disguised exports, evading supervision, and stealing. The way to evade taxes has rectified the export environment. On December 29, 2007, the Ministry of Commerce issued ((2008 Tungsten Products, Export Standards for Export Products) (Ministry of Commerce, No. 106, 2007), stipulating that there were 13 state-owned tungsten export enterprises in 2008. To further rectify and standardize the export order.

Third, the impact of tungsten ore macro-control policies

(1) Optimized the industrial structure and promoted deep processing and fine processing of the tungsten ore industry

Since the implementation of the national macro-control policy, China's tungsten industry has gradually changed the past development mode of high consumption, high pollution, and low added value of products, and has developed toward large-scale, group, and high-tech. At present, the product structure of the tungsten industry is gradually optimized, and the product development speed is accelerating. Moreover, Jiangxi has established a tungsten new material science and technology export and innovation base in Zhangzhou; and established a national-level scientific and technological innovation research and development center in Zhuzhou and Xiamen. At the same time, the industry is increasingly developing in the direction of scale. The proportion of large-scale state-owned enterprises and the total economic output have further increased. The sales of seven tungsten processing enterprises in the country account for more than 50% of the whole industry.

(2) The price of tungsten products has risen steadily, which has increased the right to speak in the pricing of tungsten products in China.

During the six years from 2002 to 2008, the export price of tungsten in China showed a trend of increasing year by year. In 2002, the average export price of tungsten products in China was less than US$10,000/t, which increased to about US$35,000/t in 2007. In 2008, affected by the financial crisis, the average price of tungsten was 34,123. 2 US dollars/t, which increased during the past five years. Nearly 3.5 times. From 2002 to 2008, the prices of tungsten concentrates such as tungsten trioxide, APT, tungsten wire and tungsten rods are all on the rise. In 2008, due to the impact of the international financial crisis, prices of related products such as tungsten rods fell (see Figure 1).

(3) The increase in output of tungsten concentrates has decreased and resources have been protected.

In 2002, the output of main products of tungsten concentrate in China was 67,200 tons, which reached its peak in 2004 and increased to 85,400 tons. Since 2006, the products of major tungsten concentrate products have shown a downward trend, showing that the effectiveness of macro-control effects is very significant. In addition, the output of major tungsten products such as APT, tungsten oxide, tungsten powder and tungsten rods is also slowly developing or even declining, reversing the development of blindly rapid growth in the past (see Figure 2).

(4) Suppressed exports and increased imports

In China's macro-control policies on tungsten mines, an important purpose of eliminating export tax rebates and raising tariffs is to curb exports, protect resources, and promote the optimization and upgrading of industries. According to the results of the five-year policy implementation, the export volume of tungsten products in China is slowly growing, and there has been a downward trend in 2007.

In 2008, the effects of various macro-control policies were concentrated, and affected by the financial crisis, exports have fallen to levels before 2003. However, the import volume has steadily increased, from 1,635 tons to 6629.8 tons at the peak, which has more than doubled (see Figure 3), which fully realizes the purpose of implementing macro-control policies in China.

Fourth, the problems of the policy

(1) Mining indicators and export quotas cannot be fully implemented

Although the Ministry of Land and Resources has issued annual tungsten production indicators, and requires the relevant provincial (municipal, district) land and resources management departments to be based on the state of the relevant city and county mining enterprises in their respective jurisdictions, the development and utilization, the level of resource utilization, the indicators Decomposed into counties and mining enterprises. However, in the specific implementation process, it can not be carried out according to the indicators, resulting in the total production at the end of the year greatly exceeding the production indicators at the beginning of the year, undermining the country's overall development plan. For example, in 2005, the total amount of mining produced by the state was 52,000 tons, and the actual production was 73,400 tons, with an excess ratio of more than 20%. In some regions, export quotas are also ineffective. In 2008, most enterprises used export quotas of only 1/2, and the quota system could not achieve the purpose of protecting resources.

(2) Smuggling activities further disrupt market order

Through the macro-control policies in recent years, the state has strictly controlled the export of products and raised the price of products, but the rise of international prices has stimulated the smuggling activities of domestic tungsten-related products. It is estimated that smuggling of APT and tungsten oxide can avoid 10% of export tariffs, and tungsten iron can escape 20% of export tariffs, and the benefits are very impressive.

In 2008, there were always low-priced tungsten products smuggled out of the market, which disrupted the market order.

(3) The integration of the tungsten industry has damaged the legitimate interests of small and medium-sized enterprises.

In 2002, the country stopped issuing new mining licenses for the tungsten industry. At the same time, it integrated small-scale, heavily polluted mines with tungsten products processing enterprises with low technological content and low production capacity to form large mining groups and improved China. Tungsten products and tungsten prices have the right to speak internationally. However, this series of policies ignores the interests of small and medium-sized mining enterprises and mineral processing enterprises. When the mining situation is not good, they have contributed to the development of the country; when the international mining situation turned better, it was closed or integrated into other mining companies, which led to the dissatisfaction of many small and medium-sized enterprises.

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