Magnetic Materials Report 5 – China’s Magnetic Materials Enterprises

As of 2020, there are quite a few companies of different scales engaged in magnetic materials in China, and the competition within the industry is fierce. This report focuses on several representative leading companies.

China's Magnetic Materials Enterprises

China’s Magnetic Materials Enterprises

Ningbo Yunsheng Co., Ltd.

Company Profile

Ningbo Yunsheng is a national high-tech enterprise, specializing in R&D, manufacturing and sales of rare earth permanent magnet materials since 1995. Yunsheng has four production bases in Ningbo, Baotou, Beijing and Qingdao, with an annual production capacity of 14,000 tons of billets. It is the world’s leading solution for rare earth permanent magnet materials application solutions.

The company’s main business is to provide customers with high-end NdFeB magnetic material application solutions, and is committed to extending to the downstream magnetic component application field. The company’s products are widely used in green energy-saving and environmental protection fields such as new energy vehicles, consumer electronics, urban rail transit, industrial robots, energy-saving home appliances, wind power generation, etc., in line with the national development strategy of “carbon peaking and carbon neutrality”.

Enterprise development status

Operating income of Ningbo Yunsheng from 2015 to 2020

Yunsheng maintained a relatively high annual operating growth rate until 2019. Affected by the epidemic in 2019, the global manufacturing industry has been impacted to varying degrees, and the rare earth permanent magnet industry is also facing huge challenges. China has controlled the epidemic well in the world, and took the lead in resuming work and production in the world. my country’s rare earth permanent magnet industry has been able to quickly recover and develop. Yunsheng’s overall business revenue growth rate has returned to a rapid growth trend in 2020 after a sharp drop in 2019.

Proportion of Ningbo Yunsheng’s main product revenue in 2020

As of 2017, the main products disclosed by Ningbo Yunsheng include NdFeB permanent magnet products, as well as motors, magnetic components, etc. Among them, NdFeB permanent magnet products account for nearly 80% of the company’s operating income.

business model

(1) Procurement mode

The raw materials purchased by the company mainly include rare earth raw materials and other auxiliary materials. According to sales orders, the company adopts a strategy of paying equal attention to both on-demand procurement and strategic reserves for raw materials. The company has a complete procurement system, and has established strict internal control procedures in aspects such as supplier selection, contract signing, material storage, inspection, payment, and supplier evaluation.

(2) Production mode

The company’s customers are located in many application fields, and the customized and dedicated production mode is adopted. The company implements the division system, and the product engineers of each division are deeply involved in the research and development of the client’s application side, providing customers with solutions for the application of high-end NdFeB magnetic materials.

(3) Sales model

The company’s sales model is mainly direct sales. Under the direct sales model, each business department of the company has direct contact with downstream customers to fully understand customer needs and grasp market development trends.

Hengdian Group East Magnetic Co., Ltd.

Company Profile

The predecessor of Hengdian Group East Magnetic Co., Ltd. was founded in 1980, and the joint-stock company was restructured and established in March 1999. In August 2006, Hengdian DMC was successfully listed on the Shenzhen Stock Exchange (stock code 002056).

Hengdian DMC is the rotating chairman unit of China Electronic Components Industry Association. It is a high-tech private enterprise with two major industries: magnetic materials + devices, photovoltaic + lithium batteries. DMC is currently the world’s largest permanent magnet ferrite manufacturer, the world’s largest soft magnetic material manufacturer, a solar energy manufacturer that has obtained the certificate of domestic leader, and one of the world’s major vibration motor manufacturers.

DMC is the main supplier of the world’s top 500 companies and a pioneer in technological development. It has been rated as an excellent supplier by Brose, Panasonic, Cooper, Nidec and other internationally renowned companies for many years, and has been awarded the best global supplier by Bosch Jackpot.

Enterprise development status

2015-2020 Hengdian East Magnetics’ Operating Income and Magnetic Material Business Income

During 2018, the domestic economy slowed down and uncertainties in the international environment increased. The overall market performance is sluggish, the demand is lower, and the competition in the magnetic material industry is intensifying. Coupled with the impact of the global epidemic in 2019, Hengdian DMC has experienced a substantial and continuous decrease in the growth rate of its magnetic material business. Due to the wide range of DMC’s overall product categories, magnetic materials only account for about 44% of the total products, and the downturn in the magnetic material market has not seriously affected DMC as a whole. After the improvement of the overall domestic environment in 2020, DMC’s magnetic material business growth has shown a recovery trend, but the growth rate is still slightly lower than the overall business growth rate.

Proportion of Hengdian East Magnetic’s main product revenue in 2020

business model

The company has an independent research and development, procurement, production and sales system, mainly through the production and sales of magnetic materials + devices, photovoltaic + lithium batteries and other related products to achieve profitability. In terms of research and development, the company focuses on independent research and development, and has established a division-level research and development model that focuses on customer needs, and the company’s research institute combines forward-looking new industries and high-end product research and development; Standardized processes, systematic supplier evaluation, etc., strictly control the procurement checkpoints to ensure the reliability of raw materials or equipment and the competitiveness of costs; in terms of production, the company mainly adopts the method of “determining production based on sales” to arrange production; in terms of sales , The company provides customers with corresponding products and after-sales service according to the customer’s purchase contract and order requirements.

Beijing Zhongke Sanhuan High-tech Co., Ltd.

Company Profile

Beijing Zhongke Sanhuan High-Tech Co., Ltd. was founded on July 23, 1999 by Beijing Sanhuan New Material High-Tech Company (now renamed as “Beijing Sanhuan Holdings Co., Ltd.”), which is affiliated to the Chinese Academy of Sciences. A company established and listed on the Shenzhen Stock Exchange of China on April 20, 2000, stock code 000970. Zhongke Sanhuan continues the main business of Sanhuan Company and is engaged in the research and development, production and sales of magnetic materials and their application products.

Zhongke Sanhuan has five sintered NdFeB permanent magnet manufacturers—Ningbo Koningda, Tianjin Sanhuan Lexi (joint venture with Taiwan All Metals), Beijing Sanhuan Wackerhua (joint venture with German vacuum melting), Zhaoqing Sanhuan Jingyue, Ganzhou Sanhuan and a bonded NdFeB permanent magnet manufacturer – Shanghai Sanhuan (joint venture with Japan Seiko Epson); a stake in a sintered NdFeB permanent magnet manufacturer – Hitachi Metal Sanhuan Magnetics Materials (Nantong) Co., Ltd. (joint venture with Hitachi Metals), a soft ferrite manufacturer—Nanjing Haitian Jinning Sanhuan Electronics Co., Ltd. (with Nanjing Jinning Electronics Group and Sinosteel Tianyuan Co., Ltd.) and a non-ferrous Crystal soft tape production enterprise – Tianjin Sanhuan Aona Technology Co., Ltd. Zhongke Sanhuan’s main product NdFeB is widely used in energy, transportation, machinery, information, home appliances, consumer electronics, etc., especially in recent years, the rapid development of the global energy conservation and environmental protection industry Applications in emerging fields such as energy-saving home appliances, robots, and wind power generation. Zhongke Sanhuan is a representative enterprise of China’s rare earth permanent magnet industry and one of the largest manufacturers of NdFeB permanent magnets in the world.

Zhongke Sanhuan has obtained the Hitachi Metal NdFeB patent license, and its patented products are exported to all over the world through Beijing Zhongke Sanhuan International Trading Company with the “SANMAG®” trademark, and have been selected as the “Best Supplier” by well-known international enterprises for many times. “.

Enterprise development status

Operating income and magnetic material business income of Zhongke Sanhuan from 2015 to 2020

During 2018, the domestic economy slowed down and uncertainties in the international environment increased. The overall market performance is sluggish, the demand is lower, and the competition in the magnetic material industry is intensifying. Coupled with the impact of the global epidemic in 2019, most domestic magnetic material companies have experienced a decrease in the growth rate of the magnetic material business, or even negative growth. The situation has improved because China took the lead in controlling the epidemic and resuming work and production. However, due to repeated international epidemics, business growth is still affected to a certain extent.

Proportion of main product revenue of Zhongke Sanhuan in 2020

business model

Zhongke Sanhuan is the earliest enterprise engaged in the R&D and production of NdFeB magnetic materials in China. It has been deeply involved in major global markets for many years, and has now developed a huge customer base, especially in new energy vehicles. Significant progress has been made. With the business philosophy of abiding by business reputation and strictly controlling product quality, the company’s products have been widely recognized by domestic and foreign customers, and have established a good reputation and brand among downstream customer groups.

Relying on its own technical advantages, Zhongke Sanhuan has established a “personalized service sales model”, which is closely linked with customers. From the moment when customers propose new products or new application projects, it maintains close contact with customers and fully understands them. , excavate and meet customer needs, consolidate the foundation of cooperation through close cooperation, and work hand in hand with customers to truly achieve win-win cooperation.

Anhui Longci Technology Co., Ltd.

Company Profile

Anhui Longci Technology Co., Ltd. (stock code: 300835) was founded in 1998 and listed on the Growth Enterprise Market in 2020. Mainly engaged in the research and development, production and sales of permanent magnet ferrite and soft magnetic products.

The high-performance permanent magnet ferrite wet-pressed magnetic tile produced by Longci is the core component of DC motor, which is widely used in various parts and accessories such as automobile drive, electrification system and body, such as starter motor, ABS motor, wiper motor, window rolling motor etc. It contributes to the innovation and development of new technologies such as power, environmental protection, intelligence, safety and comfort of automobiles. With the application and popularization of frequency conversion technology, high-performance permanent magnet ferrite wet-pressed magnetic tiles have also played an irreplaceable role in the industrial upgrading of the household appliance industry.

Since 2020, Long Magnetic has been actively deploying and constructing soft magnetic projects. A number of teams and production lines have been established such as soft magnetic powder preparation, magnetic core production (metal magnetic powder core, ferrite powder core), device development (vehicle, photovoltaic inductors and chip inductors). China’s Magnetic Materials Enterprises

Enterprise development status

Proportion of Anhui Longci’s main product revenue in mid-2020

Given that Anhui Longci has just been listed in 2020, its corporate announcements regularly disclosed by the China Securities Regulatory Commission only include the operating data for 2020, and annual horizontal comparisons cannot be made. In 2020, Anhui Longci’s overall operating income was 559 million yuan, and its main product, high-performance permanent magnet ferrite wet-pressed magnetic tiles, accounted for over 80% of the operating income.

business model

Longci adopts the production mode of production based on sales and customized to order. After receiving the customer’s order, the company organizes a contract review and comprehensively evaluates conditions including personnel, equipment, molds, tooling and fixture capabilities, raw and auxiliary materials and accessories, estimated delivery cycle and other conditions, and then formulates a production schedule, and then organizes, according to the production schedule. Reasonable allocation of appropriate resources. And carry out comprehensive control and management of each technological process.

(1) Procurement mode

The main raw materials of the company’s leading product wet-pressed magnetic tiles are iron red, strontium carbonate and pre-sintered materials. The production department of the company prepares a production plan for a certain period (monthly, quarterly) according to customer contracts and orders, and the purchasing department purchases raw and auxiliary materials from suppliers according to the production plan and inventory status. The company maintains a certain safety stock of main raw materials to cope with the increase in customer orders and the requirements of production cycle. The company implements qualification certification for suppliers in accordance with the requirements of the quality management system. The company negotiates with major suppliers to determine the annual purchase quantity and price, and issues purchase contracts to suppliers in installments according to product order requirements. China’s Magnetic Materials Enterprises

(2) Production mode

The company implements an order-based production management mode, and arranges production according to the different requirements of customers. After the preliminary review of customer contracts and orders, the marketing department transmits the “customization notice” to the production department according to the requirements of the order. Personnel review, and according to the company’s quality management system “production operation control procedures”, the “custom order notice” is passed to the technical research and development, quality management and other departments. After the technical research and development department formulates the process standards and the quality management department formulates the inspection standards, the production workshops of the production department organize personnel to carry out production, and finally the marketing department contacts the freight unit according to the contract period to deliver the goods on schedule. China’s Magnetic Materials Enterprises

(3) Sales model

The company mainly adopts the direct sales model. The company directly signs a sales contract with the customer and produces according to the order. After the product is qualified by the customer’s inspection, it will receive payment directly from the customer according to the contract.

The company has a small amount of sales with traders, the traders place orders to the company, the company delivers to the traders and settles with the traders. China’s Magnetic Materials Enterprises

Segment Neodymium Magnets

Phosphate Plated Motor Magnets Neodymium

Passivation Coating NdFeB Magnets for Motor

Epoxy Coating Segment Sintering NdFeB Magnet

NdFeB Segment Brushless DC Motor Magnets

Motor Segment Neodymium Magnet N35H

Motor Segment Permanent Magnets

Motor Segment Magnets N45SH Neodymium