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Xuancheng City Government Notice on the Printing and Distribution of the Xuancheng City Non- Ferrous Metals Industry Adjustment and Revitalization Plan

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Xuancheng City Government Notice on the Printing and Distribution of the Xuancheng City Non- Ferrous Metals Industry Adjustment and Revitalization Plan Xuancheng City Government Notice on the Printing and Distribution of the Xuancheng City Non- ferrous Metals Industry Adjustment and Revitalization Plan Xuan Zheng [2009] No. 79 All county, city, and district governments, city departments, and directly-subordinate divisions: Xuancheng City Non-ferrous Metals Industry Adjustment and Revitalization Plan is hereby printed and distributed to you. Please be practical and conscientiously organize its implementation. December 31, 2009 Xuancheng City Non-ferrous Metals Industry Adjustment and Revitalization Plan The non-ferrous metals industry is one of our city’s major basic raw materials industries with relatively great advantages and potential; and one of the priority industries for cultivation in our city. This plan has been formulated in order to promote scientific industry development, improve equipment and technology, increase product variety and added-value, extend industry chains, improve economic efficiency and competency, and facilitate a better and accelerated development of the non-ferrous metals industry. We have formulated this plan on the basis of the Anhui Province Non-Ferrous Metals Industry Adjustment and Revitalization Plan, with consideration for our own situation. The plan is for the period of 2009 to 2011. I. Current Status of our City's Non-ferrous Metals Industry After ten years of rapid growth, the city's entire copper and aluminum processing industries have begun to take shape based on a solid foundation, and a major processing base for scrap copper and aluminum has been formed in Anhui province. The city currently has 21 large non-ferrous metal processing companies with total assets of 1.355 billion RMB. In 2008, the non-ferrous metal industry had a total sales revenue of 13.108 billion RMB, with 24.73 percent consisting of large enterprise sales revenue. There are six large non-ferrous metal mining and processing companies, with mined metals including copper ore, aluminum ore, and tungsten ore, of which the total sales revenue was 210 million RMB in 2008. (I) The Copper Processing Industry Xuancheng has 15 large-scale copper processing companies, which are located in Langxi County, Xuanzhou District, Guangde County, Jing County, and Jixi County. 1. Production capacity and output. Xuancheng's copper processing production capacity is about 500,000 tons. In 2008, copper production was 247,000 tons and sales revenue was 12.565 billion RMB, with 23.71 percent consisting of large enterprise sales revenue. Tax revenue amounted to 402 million RMB, which constituted 24.65 percent of the city's total large enterprise tax revenue. Copper processing has become a very important part of Xuancheng's economy. 2. Technology and equipment. The technology and equipment in the copper processing industry range from advanced, to commonplace, to poor. The Jinrun Copper Plant in Langxi County is an example of an enterprise with advanced technology and equipment. It is equipped with German Krupp continuous casting and rolling process technology, German Siemens programmable control technology, a German Niehoff MM85 double end wire drawing machine, an Italian Youle Levon annealing wire drawing machine, and German SPECTRO direct reading spectrometer detection equipment and eddy current testing equipment. Xuancheng's Baolong Copper LLC is an example of an enterprise with commonplace technology and equipment. Its smelting furnaces are either oil-fired or gas-fired reverberatory furnaces; it uses the oxygen-enriched air floating smelting process; and it has patented, and has the intellectual property ownership of the "conjoined undercurrent tilting furnace continuous caster." 3. Main products. The main products of our copper processing industry are bright, low- oxygen copper rods and various types of soft bare copper wire. The bright, low-oxygen copper rods are mainly 8mm in diameter and the soft bare copper wire is mainly 3mm in diameter (II) The aluminum processing industry Xuancheng has six large-scale aluminum processing companies. They are mostly located in the city itself, Xuanzhou District, Guangde County and the city of Ningguo. Xuancheng's aluminum production capacity is about 80,000 tons. In 2008, the total aluminum production was 60,500 tons, sales revenue was 540 million RMB, and tax revenue totaled 22 million RMB. The main products of the aluminum processing industry are: various types of aluminum, aluminum bars, and aluminum ingots. (III) The non-ferrous metal mining and dressing industry Xuancheng has six large-scale non-ferrous metal mining and dressing companies, with two copper mining and dressing companies in Xuanzhou District, one copper mining and dressing company in Jing County; one aluminum and tungsten mining and dressing company in Jing County, and two aluminum and tungsten mining and dressing companies in Jixi. In 2008, the total copper ore mining yield was 1,604 tons and the aluminum and tungsten mining yield was small. Currently, the city does not have any copper, aluminum, and tungsten smelting companies. (IV) Major existing problems In recent years, Xuancheng City has been actively looking for development opportunities and brought in and built up a number of non-ferrous metal processing companies, and the city's non-ferrous metal processing industry has begun to take shape. We have promoted industrial economy development and strengthened the economy. However, serious problems and challenges still remain in the city's non- ferrous metal processing and mining industry. First, processing companies are small. In 2008, the city had 15 copper processing companies, with a total production capacity of 500,000 tons and an average production capacity of only 33,300 tons. Even the few big companies, such as Langxi Jinrun Copper, Xuancheng Baolong Copper, and Langxi Xinhui Electric, have only a production capacity of 80,000 tons per year. The biggest aluminum processing company, Shengxin Aluminum, has only a production capacity of 30,000 tons per year. Second, technologies and equipment are outdated. There is little advanced technology while equipment and commonplace technology and equipment are everywhere. A lot of the equipment and technology is high in energy consumption and high in pollution. This problem is especially obvious in the copper processing industry, in which smelters are mostly 10 to 20 cubic meters, with a low continuous-casting ratio. Our technology and equipment are still significantly below the national advanced level. Third, the product structure is simplistic. Most products are low in technology and roughly processed. Highly processed products, finely processed products, and high added-value products are few, and there is a lack of product diversity. Copper products are mainly bright low oxygen copper rods, and soft bare copper wire and aluminum products are commonplace types of materials. Fourth, non-ferrous metal exploitation and mining efforts are insufficient. Even though we have large copper, aluminum, and tungsten reserves and some mining companies, we do not have a post-mining industrial chain that runs through ore processing and comprehensive utilization. II. The Non-ferrous Metals Development Environment During the periods of the "11th Five-Year Program" and "12th Five-Year Program," Xuancheng's non-ferrous metals industry was provided with important opportunities. (I) There are national policies that are favorable to non-ferrous metals industry development After the issuance of the national Non-ferrous Metals Industry Adjustment and Revitalization Plan, the province sent out the Non-ferrous Metals Industry Adjustment and Revitalization Plan, in which Xuancheng is listed as the provincial scrap copper industry base. This will greatly promote development of the city's non-ferrous metals industry. (II) Domestic market demand is driving non-ferrous metals industry development In 2008, national copper production reached 7.4859 million tons, for a comparative increase of 19.05 percent. National total copper consumption reached 7.9033 million tons, and China became the biggest copper market in the world. In 2008, national aluminum production reached nearly14.274 million tons, for a comparative increase of 21.4 percent. China continues to be the largest aluminum producer in the world. With the rapid growth of the national economy, non-ferrous metal market demand will continue to rise. (III) Rapidly developing technologies are providing substantial support for non-ferrous metal industry upgrading As of right now, China has researched, trial-produced, and produced 250 copper brands, 2,000 copper varieties, and nearly 10,000 copper types. The pure copper to copper alloy ratio is six to four, and the varieties of copper are: 17.6 percent in sheets, 11.64 percent in tubes, 15 percent in rods, 27.35 percent in wire, and 1.28 percent in foil. Copper products are widely used in electrical power and electronics (60 percent), construction (15 percent), home appliance manufacturing (10 percent), industrial machinery manufacturing (5 percent), and transportation (4.5 percent). Copper consumption is rising rapidly in the electronics industry, the appliance industry, the automobile industry, and the construction industry. Sheet aluminum for cans and high-end aluminum foil is approaching an advanced international standard. Researchers have achieved great success in huge-diameter, thin-tube aluminum for high speed train bodies and have expanded aluminum alloy usage for railways, highways, automobiles, and airplanes. III. Guiding Ideology, Basic Principles,
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