Business Opportunities of the Abrasives Industry in the China-South Korea Business Forum

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Recently, iAbrasive has made an analysis on the potential business opportunities for the abrasives industry that lie in the China-South Korea Business Forum in such fields as car production, shipbuilding, and cellphones.

In July 2014, China's president, Xi Jinping, was invited to visit South Korea. The follow-up visitors reached 250, being the largest group ever. At the forum, Chinese and North Korean entrepreneurs reached more than 420. Liu Zhenmin, the head of China's Ministry of Foreign Affairs, revealed that during this visit, Chinese president Xi Jinping signed a total of twelve documents, including the manufacturing industry, economy and trade, the environment, energy, cultural and educational exchanges, education, consular agreement, etc. To the abrasives industry, business opportunities may lie in such fields as car production, shipbuilding, and cellphones.

The Abrasives in Car Production

The auto industry belongs to the upstream industries of the abrasives. The development of the auto industry will bring many opportunities to the abrasives industry. It is noteworthy that with the establishment of China-South Korea FTA, South Korea's auto parts import tariff will witness a substantial decrease. China and South Korea's auto parts transactions are becoming more and more frequent, which is a piece of good news for China's domestic auto parts manufacturers.

With the two nations' commercial intercourse, China's cars can export to South Korea. Since home-assembled cars have made progress with each passing day and sell at an inexpensive price, they should be popular among Korean consumers. Currently, China's new energy vehicles are developing rapidly. Therefore there is a great possibility for China's new energy vehicles to enter into the Korean market.

During car production, there are various applications of the abrasives and abrasive products; for example, finishing materials like polishing wax, cleaning agent, and brightening liquid; bonded abrasives market like cutting discs, grinding discs, and grinding wheel discs are also significant; coated abrasives like abrasive belts, sanding rolls, and sanding paper also play an important role in the car production process. In the gas piston manufacturing process, diamond or CBN welding abrasive sticks will be employed; the brake pad processing requires diamond grinding wheels, diamond drill bits, and diamond saw blades; bearings processing needs diamond or CBN cutting tools; while in the metal grinding process, the grinding machine is indispensable. Besides that, in the polishing and cleaning process of the car, polishing wax and cleaner fluid are needed.

Nowadays, the development of the auto industry has raised new requirements for the abrasive industry. In the future, large numbers of new vehicle types will call for more precise manufacturing techniques, and their production cycle will be shortened substantially, which means that stricter requirements will be made to the abrasive industry.

The Abrasives in Shipbuilding

According to relevant personnel, this year the South Korean diesel engine bet axle order is overburdened and is shifting to Chinese enterprises. The diesel engine is the core part of the ship, and the bet axle is a key supporting part of the diesel engine, which implies that the shipbuilding market is getting better. China's shipbuilding industry will usher in a new round of development.

Upon Xi's visit to South Korea, companies in Korea and China have established cooperative relationships, which have provided abundant raw materials for the auto industries, railroad industries, and shipbuilding industries in both countries.

Known as the "industrial teeth" , the abrasives industry is widely used in shipbuilding and other heavy machinery industries. Just take shipbuilding materials for example; ceramics, stone materials, copper, aluminum, casting iron, steel, etc. all require grinding and polishing. Meanwhile, based on different processing objects, cylindrical grinding, internal grinding, flat surface grinding, cutter grinding, welding grinding, honing, ultra precision machining, and grinding and polishing processes will be conducted. As a result, the shipbuilding industry is highly dependant on the abrasive industry. The development of shipbuilding technologies has raised new requirements for the abrasive industry. Developing high-end abrasive products and reducing import dependence have become the urgent issues for Chinese abrasives manufacturers.

The Abrasives in the Cellphone Industry

With the increasing export volume of South Korean cellphones dominated by Samsung Electronics and LG Electronics, South Korean cellphones have seen a rapid rise in the world's market share and popularity. According to the latest research report of the American Strategy Analytics, in 2013 Samsung shipments reached 319,800,000 sets, accounting for 32.3% of the global market share. In China, Samsung cellphones also come out in front. Samsung smart phones' influence on China's smart phone industry cannot be ignored.

During the forum, China and South Korea revealed a further cooperation tendency in the communication apparatus industry. Ren Zhengfei, the CEO of Huawei; Wang Xiaochu, the chairman of China Telecom; Kang Haowen, the vice president of Samsung Electronics; and Ju Benmao, the president of LG Group, attended the forum.

During the cellphone production process, polishing, grinding, and cutting tools are used throughout the process. Grinding discs are used in the cutting of the cellphone battery electrode array, aspheric lens processing, the touch panel and glass panel processing, and semiconductor wafer processing. Besides that, grinding heads are used in quartz resonator, out packing processing, and the touch screen edge grinding.

With the growth of the telecommunications market, relevant abrasives and abrasive products have been faced with an ever-increasing challenge as well as opportunities. How to upgrade and transform to grasp the fast-developing market has become a vital issue for the abrasives companies.

In recent years, with the leadership of the Communist Party of China, the Chinese economy has been developing rapidly. How to grasp the opportunities and go global has become a tough problem that many enterprises in China are faced with. The abrasive companies in China should make correct judgments on where the tendency of the abrasives industry lies. Only in this way, can they grasp more business opportunities.

Author: Liwei Chu
Copyright: & Diamond Tools Market

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since: 08/2012
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