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Mr. YU ZHENGDI

Purchase Director at HBC

What do you value most from TUBACEX as a partner?

Mutual trust between both companies after long-term cooperation. It means that we can rely on each other during both market boom and stagnant situations. For urgent projects, HBC can get special support from TUBACEX on deliveries. In the case of project postponement, we appreciate that TUBACEX always does its best to adjust its production plan. From our side, we also spare no efforts in promoting TUBACEX tubes to end users and are always willing to accept the postponement of orders as long as it does not seriously hinder the schedule of the projects. To achieve this, transparent communication with each other is a must. All these factors have helped both companies to be successful and competitive. Uncertainty is the key word of the current powergen market in China. We need to enhance the good relationship further to be stronger in this challenging situation.

Mutual trust, a key aspect in our relationship.

Could you give some recommendations about how to further enhance the current good relationship?

We have seen not only frequent communications between both companies but also communications at different levels and among different departments. Such communications go beyond the traditional sales and purchase relation. For example, I noticed that the meetings with the mill manager, planning manager and quality manager in TUBACEX are quite fruitful and improvements have been made after each meeting. My personal feeling is that these kinds of good relationships can be tighter if we can communicate in greater depth on the R&D of new materials, such as 650 ºC and 700 ºC tubes and pipes. It will elevate our strategic relationship to a higher level.

What impact do they expect on projects approval after the President’s announcement to reduce coal?

2015 and 2016 should be the peak years for coal fired power projects. However, technically speaking, there is no better solution to replace coal fired power plants in the next 3~5 years. The demand for premium steel products will be lower but, due to the high temperature and pressure of new power plants, the total demand tonnage should still be at high level. More than 100GW of new projects were approved in 2015. Some of them will certainly be either suspended or even cancelled. It would be difficult or maybe impossible to forecast the final situation. At the same time, however, some new projects, such as the replacement of small units with large ones or cogeneration units, etc. will still be approved in the future. Though the quantity will be much smaller. The overseas market may contribute to sustaining the development of the coal fired power market as well.

We have established many historic records in China.

How do you foresee the 2017 economic environment for your Company?

HBC has sufficient backlog of projects to be produced in the next two years, most of which are USC units. We foresee that our workshops will be at full capacity, but again uncertainty may be a headache for our production planning. Some projects may be postponed while others may be brought forward.

What are the strengths of HBC in the boiler market of China?

As one of the largest boiler groups, HBC has established many historic records in China: the first 600MW USC unit, the first 1000MW USC unit, the first 660MW and 1000MW secondary re-heating units, etc. HBC has a wide product range of boilers for different types of power plants, including conventional coal fired, combined cycle and cogeneration power plants. We are very strong in design and produce boilers capable of functioning with low quality coals.