The gap is really great. Though China uses a different formula to calculate production costs, the dominant reason for the gap lies in our complex processing technology, backward equipment, failure in comprehensively utilizing mineral resources and low productivity. China is still employing shaft smelting technology and electrical smelting technology, while developed countries have continuously decreased their production costs after breakthroughs in smelting technology and metallurgical technology. The competition in production costs will be increasingly fierce. The third gap lies in technical development.
China is weak in developing and industrializing new materials made from nickel and cobalt.
China cannot satisfy domestic demand for high and new-tech products. As for product structure, preliminary products account for too large a percentage, but it cannot develop and produce functional nickel and cobalt materials for the metallurgical industry and battery makers and satisfy the large needs of the domestic market. Our nickel and cobalt industry is vulnerable both in the sense of resources and production. After access to WTO, China s economy will merge with the international economy at a faster pace. This will bring about valuable opportunities and unprecedented challenges to our nickel and cobalt industry.