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Refractory materials, as an indispensable basic supporting material for high-temperature industries, are of self-evident importance. These materials not only have excellent high-temperature mechanical properties and volume stability, but are also key elements in the production process of many industries such as metallurgy, building materials, chemicals, and non-ferrous metals. The global refractory market continues to expand. As the world’s largest producer, consumer and exporter, China accounts for more than 60% of the world’s output. In recent years, with the acceleration of the global industrialization process and the tightening of environmental protection policies, the refractory industry is undergoing profound changes and transformation and upgrading.

1. Current status of the development of the refractory industry

1. According to Grand View Research data, the global refractory market size will reach US$31 billion in 2023, and the compound growth rate is expected to be about 4.5% from 2023 to 2030. Behind this growth is the urgent demand of downstream industries for high-performance and long-life refractory products. In the downstream application field of refractory materials, the steel industry occupies a dominant position, accounting for as much as 65%. In addition, the demand for the building materials industry (such as cement and glass) is also relatively stable, and the consumption of the cement industry in 2023 accounts for about 17%. With the development of emerging fields such as new energy and chemical industry, the demand for high-performance refractory materials is also growing rapidly, with an annual growth rate of more than 10%.

2. Technological innovation and competitive landscape. The industry’s technological upgrades are mainly concentrated in the direction of greening, intelligence and functional integration. For example, the development of environmentally friendly materials with low thermal conductivity and high corrosion resistance, as well as the application of Internet of Things technology in the monitoring of kiln lining loss, have significantly improved the service life and production efficiency of refractory materials. However, the domestic refractory market concentration is low, with CR10 less than 15%, but the leading companies are accelerating integration through mergers and acquisitions, and the industry concentration is expected to increase further.

3. Cost and policy pressure. Raw material costs account for more than 60% of the production cost of refractory materials. In 2023, the price of magnesite increased by 18% year-on-year. Combined with the investment in environmental protection equipment transformation, the gross profit margin of small and medium-sized enterprises was compressed to 8%-12%. At the same time, the tightening of environmental protection policies has also prompted companies to accelerate technological iteration. In 2023, the proportion of industry R&D investment rose to 3.5%.

2. Prospects of the refractory industry

1. Technological transformation of the steel industry (such as hydrogen metallurgy and arc furnace short-process technology) will drive the growth of demand for non-oxide refractory materials. In addition, the demand for high-purity quartz refractory materials in the new energy field (such as photovoltaic polysilicon melting furnaces and power battery sintering kilns) has increased by more than 15% annually. The circular economy also brings new opportunities to the industry. It is expected that the proportion of recycled refractory materials will increase to 25% in 2025.

2. The application of nanotechnology, digital twin systems and 3D printing technology is driving the refractory industry to develop towards high-end and intelligent development. For example, nano-coating technology can improve the slag erosion resistance of refractory materials by 40%, and has been piloted in some enterprises.

3. The infrastructure investment in countries along the “Belt and Road” has increased, providing an important increase in refractory exports. Chinese refractory companies have circumvented European and American tariff barriers and reduced production costs by building production bases in Southeast Asia, Africa and other places.