Since 2026, the aluminum processing industry has enjoyed rising prosperity, while the refractory industry as a whole remains at the bottom of its business cycle. Amid this divergence across the industrial chain, Kaituo New Materials based in Xinmi, Henan, is stepping into the niche track of refractories for aluminum melting and casting with its 35,000-ton-per-year refractory project under construction.

According to the EIA approval issued by the Xinmi Branch of Zhengzhou Municipal Bureau of Ecology and Environment, the Kaituo New Materials project is located at Group 1, Zhazigou Village, Pingmo Town, Xinmi City. With a total investment of RMB 30 million, the project will build two production lines for unshaped refractories and precast refractory blocks. Upon completion, the plant will have an annual capacity of 30,000 tons of unshaped refractories and 5,000 tons of precast refractory blocks, mainly supplying refractory products and integrated solutions for aluminum melting & casting, non-ferrous smelting and other sectors.

Product Portfolio Selection

In terms of product orientation, Kaituo New Materials’ product lineup aligns with the technical trends of refractories for aluminum melting and casting. For unshaped refractories, raw materials including bauxite, brown fused alumina and mullite are purchased externally, then processed through crushing, pulverizing, automatic batching, mixing and packaging into finished goods. Precast refractory blocks go through batching and mixing, vibration forming, curing and drying.

The value of unshaped refractories and precast blocks in aluminum melting and casting applications lies in construction flexibility and efficiency. Castables, ramming mixes and other unshaped materials can be formed on-site to adapt to complex furnace geometries. Precast blocks are fabricated and pre-baked inside the factory, requiring only masonry and installation on-site, which shortens the furnace shutdown and maintenance window. This product strategy directly addresses aluminum processors’ demand for reducing unplanned furnace outages.

Industry Landscape: Niche Opportunities Amid a Downcycle

Kaituo New Materials’ capacity expansion takes place against a backdrop of overall pressure on the refractory sector.

According to the 2026 semi-annual report of Puyang Refractories Group Co., Ltd., national refractory output reached 10.2866 million tons in the first half of the year, a year-on-year decline of 2.84%. The industry “continues to be dragged down by weak downstream demand and remains in a bottom-running market”. Steelmaking is the largest downstream consumer of refractories, accounting for 60%–70% of total demand. Crude steel output fell by 3% year on year, weighing on refractory demand across the board.

Nevertheless, refractories for aluminum melting and casting stand out as a structural bright spot. Stable growth in the non-ferrous metal industry underpins steady refractory demand. As aluminum processors pivot toward emerging markets such as new energy vehicles, energy storage and data centers, performance requirements for high-end refractory products keep rising. Data from the National Bureau of Statistics shows that Henan produced 8.0752 million tons of aluminum profiles from January to August, ranking second nationwide. This massive local aluminum processing capacity creates a solid demand base for regional refractory suppliers.

Xinmi’s Industrial Ecosystem

Xinmi City, where Kaituo New Materials is situated, is a major cluster for Henan’s refractory industry. Local policies explicitly support refractory development and encourage enterprises to upgrade toward functional and eco-friendly products. EIA documents show Kaituo New Materials commits to constructing the project in compliance with benchmark performance indicators for unshaped refractory manufacturers, equipped with intelligent automatic batching systems and smart workshop systems.

This commitment matches the direction of industrial regulation. The Emission Standard of Air Pollutants for Refractory Industry, implemented in January 2026, imposes stricter emission limits while opening differentiated regulatory pathways for compliant facilities. With tightening environmental rules, built-in compliance has become a fundamental threshold for new projects competing in the market.

From Capacity to Core Competence

The 35,000-ton capacity marks Kaituo New Materials’ first step in the aluminum melting & casting refractory track. Yet competition in the refractory industry is no longer defined by production scale alone. Puyang Refractories noted in its half-year report that “industry resources keep concentrating on leading enterprises”. Guoliang New Materials also indicated in investor communications that “intense competition will pressure the sector in the short run, yet accelerate the exit of low-end capacity over the long term”.

For newly built players like Kaituo New Materials, capacity is only the starting point. Its standing within Xinmi’s refractory cluster will hinge on whether it can build systematic service capabilities covering “material supply + installation + operation & maintenance” for the aluminum melting and casting niche, and win customer trust through consistent quality and responsive support. Aluminum processors are shifting their purchasing logic from unit price toward total life-cycle cost. This transition brings both opportunities and challenges for regional refractory manufacturers.