From the current overall development trend, more and more smelters are entering the zinc alloy market. In this context, how will traditional zinc alloy enterprises position themselves?
Traditional die-casting zinc alloy enterprises possess some unique advantages. For instance, they have won the favor of many end-use customers by offering customized products. Unlike large-scale production by smelters, these enterprises can adjust metal ratios according to specific customer requirements, producing alloy products distinct from the mainstream 3# and 5# alloys in the market. Currently, there is indeed a segment of customers in the market with demand for such customized zinc alloys.
In such a fiercely competitive market, how should traditional alloy enterprises respond? The following discussion will focus on three main aspects.
1. Transition From "Production" to "Trade"
According to market information, many alloy producers struggling in intense competition are gradually transforming into trading enterprises. These companies procure alloys directly from alloy plants to reduce operating costs and increase profits. It is reported that the processing fee for die-casting zinc alloy provided by smelters in the market generally ranges from 200 yuan to 500 yuan per mt. Although a few smelters set higher prices, they are still relatively lower compared to the pricing of traditional die-casting zinc alloy enterprises. As a result, many die-casting zinc alloy enterprises are choosing to reduce or cease production and instead purchase zinc alloys from smelters for resale. Additionally, some enterprises are not limited to alloy trading but also engage in the trade of various bulk commodities.
2. Extending the Industry Chain and Gradually Penetrating End-Use Markets
Furthermore, some traditional die-casting zinc alloy enterprises in the market are gradually expanding their industry chain, extending production to end-use products such as camping equipment and low-altitude parachuting equipment. Other enterprises leverage their resources and networks to explore and venture into familiar or promising fields, such as the lock industry.
3. Transition From "Traditional" to "Emerging"
Finally, due to the relatively sluggish domestic real estate market in recent years, and the significant proportion of die-casting zinc alloy applications in real estate, many alloy plants serving downstream real estate customers have seen declining business. Some enterprises in the market have reported that orders for NEVs have been booming in the past two years, while orders for emerging high-tech sectors such as optical modules and electronic components have also performed exceptionally well. This has brought more possibilities to the zinc alloy market.
In summary, facing increasingly fierce market competition, die-casting zinc alloy enterprises are actively seeking new development paths. With the entry of smelters, domestic die-casting zinc alloy resources will be more optimally integrated, bringing more opportunities to the industry. However, this will also intensify the market elimination process, forcing some small enterprises to exit amid this wave of transformation. Despite the challenges, the market also holds hope. It is believed that under the impetus of market optimization, the die-casting zinc alloy industry will continue to progress, revitalizing with new vitality and dynamism.
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