On October 31st, White dove Abrasives and Grinding Tools Co., Ltd. issued a notice on the price adjustment of bonded grinding tools. The notice shows that due to the recent significant increase in the market price of corundum raw materials, the bonded grinding tool industry is facing the dilemma of high costs. In order to continue to provide customers with high-quality products and services, Baige Abrasives will increase the price of brown corundum, white corundum, chromium corundum, and single crystal corundum bonded grinding tools by 5% -15% on the original basis from November 4th, 2024. Among them, white corundum bonded grinding tools have the highest increase of 15%.
Affected by the rise in raw material prices, not only are corundum grinding tool manufacturers raising prices, but corundum grinding tool manufacturers are also raising prices. Recently, Ruite Abrasives, a manufacturer of brown corundum, announced that due to changes in the market raw material situation, production costs have significantly increased. After thorough research and careful consideration, the price of corundum block sand and particle size sand will be increased by 200 yuan per ton starting from today.
It is understood that the main reason for the price increase of corundum abrasive and grinding products this time is the skyrocketing price of alumina. Industry insiders have stated that the alumina market is imbalanced in supply and demand, with active demand and insignificant increase in supply, leading to an increase in transaction activity in the spot market and subsequent price increases.
On the other hand, bauxite accounts for about 47% of the production cost of alumina, and the limited supply of bauxite at home and abroad makes it difficult to significantly increase alumina production, further pushing up production costs. Environmental and policy factors are also the main reasons for the rise in alumina prices. Environmental inspections have led to production restrictions or shutdowns in some mines, resulting in tight supply of domestic ores. At the same time, policy factors have also affected the import and supply of bauxite.
Raw materials such as alumina and corundum play an important role in the manufacturing of abrasives and grinding tools, and their price fluctuations have a significant impact on the overall cost structure. Therefore, with the rise in prices of alumina and corundum, abrasive and grinding tool companies have to face higher raw material procurement costs, which in turn compresses their profit margins and makes the already overcapacity and vicious competition in the abrasive and grinding tool industry even more difficult.
In the long run, abrasive and grinding tool enterprises should have the main consciousness and responsibility to turn danger into opportunity. The problem of operating costs caused by the rise in raw material prices has always existed. Relieving the pressure of cost increase through price increases is a necessary measure, but it will face adverse effects on the enterprise brand and market share caused by price increases.
Therefore, in addition to price increases, abrasive tool companies also need to strive to hedge the pressure of rising costs through their own transformation, upgrading, and innovative development, improve product quality, optimize services, etc., in order to consolidate and expand market share and win the sustained trust of consumers.
