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How To Change Buyer's Market From Sellers' Market?
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The requirements for magnesium oxide market access is relative high. Therefore, in the past case of demand exceeds supply, upstream ability to bargain is strong. It can also be said the past chemical market is a kind of typical sellers’ market. However, for magnesium oxide suppliers, the magnesium oxide is changing to buyer's market from sellers' market.
In recent years, a large number magnesium oxide chemical plant installations go into operation, the upstream enterprises and raw material structure show the tendency of diversification. The monopoly has been breaking gradually and the competition is intensifying. Especially the demand of staple commodity decreased as the the economy slows, the slowdown demand for magnesium oxide becomes a new normal.
Judging from the present condition, the magnesium oxide production industry is in the stage of rapid increase supply and slowdown demand and cutting down profit. The increasing supply will bring low price of fresh material. The bargaining power in downstream increases obviously, the profit of upstream enterprises was compressed further. The chemical industry is changing to buyer's market gradually. Although the price of raw material is decreasing, the increase of terminal demand slows down. In addition, merchant’s profit decreases obviously.
Because of it, the president of Meishen Technology had deep feelings. “The living and profit space of traditional merchant was compressed. Some magnesium oxide supplier has been forced out of the market. ” He also said, “At present, the profit of traditional magnesium oxide supplier becomes more difficult. The past model has been zero or meager profit. Even more serious is facing bankrupt.”
Meishen Technology is the leading enterprise in magnesium oxide industry. At the same time, it is the only magnesium oxide manufacturer to produce light magnesium oxide and active magnesium oxide through dolomite carbonation, brine compound process and magnesite carbonization method. It has domestic advanced production line. What’s more, the expert members of China Magnesium Salt Expert Group are responsible for technological innovation and equipment transformation. At present, this enterprise has more than 10 production line to manufacture magnesium oxide, and has already researched light magnesium oxide and active magnesium oxide with nearly 100 types of specifications and models. In this industry, it pioneered central control center, realized control by DCS and opened the door of automated management in this industry. It has been identified as “Magnesium Oxide Engineering Research Center in Xingtai” and “Hebei Enterprise Technology Center”.
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