Driven by both the transformation and upgrading of the manufacturing sector and the ‘dual carbon’ targets, the raw materials market for ceramic fibre paper—a core material in the high-temperature thermal insulation sector—is undergoing unprecedented structural changes. From fluctuations in the supply of high-purity aluminium oxide fibres to technological advancements in environmentally friendly binders, every link in the supply chain is reshaping the industry landscape. Today, Mu Yi will provide an in-depth analysis of the key shifts in the raw materials market and propose strategies for enterprises to respond.

I. Three Major Structural Shifts in the Raw Materials Market
1. High-Purity Aluminium Oxide Fibres: The Convergence of Import Dependency and Geopolitical Risks
High-purity aluminium oxide fibres are the core raw material for ceramic fibre paper, and their global supply is highly concentrated. Data shows that in 2023, China’s imports of high-purity aluminium oxide fibres accounted for 43 per cent of total supply, with the country relying primarily on nations such as Australia and Germany. However, geopolitical conflicts have led to tighter export controls in some countries; Australia’s 2024 export review of critical minerals has left domestic enterprises facing the risk of supply disruptions.
Case study: A leading enterprise experienced a 12-day production line shutdown due to imported raw materials being held up at port, resulting in direct losses exceeding 20 million yuan. This incident exposed the vulnerability of the supply chain and has compelled enterprises to accelerate the localisation of raw materials.
2. Environmentally Friendly Binders: The Balance Between Technological Substitution and Cost Considerations
Traditional ceramic fibre paper production relies on organic binders containing phenolic resins; however, such materials release volatile organic compounds (VOCs) at high temperatures. With the implementation of the EU’s RoHS 2.0 standard, bio-based inorganic binders have emerged as a viable alternative. Data indicates that products using bio-based binders can reduce VOC emissions by 85 per cent, though their cost is 30 per cent higher than that of traditional materials.
Technological Breakthrough: A starch-based inorganic binder developed by a domestic enterprise has now entered mass production; it can withstand temperatures of up to 1,400°C, whilst costing only 15 per cent more than traditional materials. This technology has reduced the time required for products to obtain EU CE certification to three months, with export orders increasing by 40 per cent year-on-year.
3. The Recycled Material Market: A Circular Economy Driven by Policy
The annual recycling volume of ceramic fibre paper has exceeded 50,000 metric tonnes, but the quality of recycled materials varies considerably. The EU’s Waste Framework Directive requires recycled materials to account for 25 per cent of industrial materials by 2025, driving Chinese enterprises to establish closed-loop recycling systems. For example, through collaboration with a steelworks, a Shandong-based enterprise has crushed waste ceramic fibre modules and reprocessed them into pulp; the resulting recycled paper has a thermal conductivity that is only 0.02 W/(m·K) higher than that of new products, whilst reducing costs by 22 per cent.
II. Four Key Drivers of Supply Chain Restructuring
1. Policy Pressure: From ‘Passive Compliance’ to ‘Proactive Upgrading’
China’s 14th Five-Year Plan for New Materials explicitly stipulates that the penetration rate of energy-saving and consumption-reduction technologies in the refractory materials industry must reach over 65 per cent by 2025. This policy has directly driven ceramic fibre paper manufacturers to phase out outdated production capacity; by 2024, the industry’s average energy consumption per unit had fallen by 23 per cent, though the rate of domestic raw material sourcing remains below 60 per cent.
2. Demand Diversification: The Interplay Between Traditional and Emerging Markets
Traditional markets: The steel and metallurgy sectors prioritise value for money, requiring raw material costs to account for no more than 35 per cent of total costs.
Emerging markets: The thermal insulation sector for new energy vehicle batteries demands raw materials that combine a high thermal conductivity coefficient (≥0.18 W/m·K) with a low thermal diffusivity (≤0.035 W/m·K), driving companies to develop nano-alumina composite fibres.
3. Technological Iteration: From ‘Catching Up’ to ‘Keeping Pace’
In 2023, the industry’s R&D intensity reached 4.7 per cent, with breakthroughs achieved in the mass production of ultra-thin (less than 0.5 mm) ceramic fibre paper, raising its tensile strength to 18 MPa. However, the high-end equipment manufacturing sector remains reliant on imported raw materials; for instance, ceramic fibre paper for aerospace applications requires aluminium oxide purity of 99.9 per cent, a standard for which only three domestic enterprises possess the production capacity.
4. Trade Barriers: From ‘Cost Competition’ to ‘Compliance Competition’
The EU Carbon Border Adjustment Mechanism (CBAM) is due to be fully implemented in 2026, requiring ceramic fibre paper exporters to disclose full life-cycle carbon emissions data. One company successfully circumvented these trade barriers by establishing a raw material production base equipped with photovoltaic power generation in Inner Mongolia, thereby reducing its products’ carbon footprint by 38 per cent.

III. Four Key Response Strategies for Enterprises
1. Localisation of Raw Materials: Establishing a ‘Safety Stock + Diversified Supply’ System
Case Study: Mu Yi invested in the construction of alumina fibre production bases in Shanxi and Inner Mongolia, reducing its reliance on imports from 43 per cent to 28 per cent, whilst also signing long-term agreements with five domestic suppliers to ensure the stability of raw material supply.
Tools: Utilising blockchain technology to enable traceability of raw materials; for example, one enterprise established a supply chain finance platform to provide low-interest loans to upstream suppliers in exchange for priority supply rights.
2. Technological Collaboration: Industry-academia-research collaboration to overcome ‘bottleneck’ issues
Model: In collaboration with the Institute of Process Engineering at the Chinese Academy of Sciences, the company developed ‘plasma melting–vapour deposition’ technology, raising the purity of alumina fibres from 99.5 per cent to 99.8 per cent whilst reducing costs by 15 per cent.
Achievements: In 2024, domestic enterprises filed 1,200 patents related to ceramic fibres, with invention patents accounting for 65 per cent of the total, gradually establishing technological barriers.
3. Vertical Integration: From ‘Raw Material Procurement’ to ‘Control of the Entire Industrial Chain’
Case Study: A leading enterprise established a complete industrial chain spanning from raw materials to end products by acquiring upstream alumina suppliers and downstream construction service providers, thereby shortening product delivery cycles by 40 per cent and increasing gross profit margins by 8 percentage points.
Trend: Industry concentration is accelerating; the CR5 (market share of the top five enterprises) is projected to reach 65 per cent in 2025, an increase of 20 percentage points compared to 2020.
4. Global Expansion: The ‘Chinese Solution’ for Mitigating Trade Risks
Approach: Establishing raw material production bases in ASEAN to leverage RCEP tariff preferences and reach the Asia-Pacific market; setting up R&D centres in Europe to develop localised products in line with regional demand.
Data: In 2024, China’s exports of ceramic fibre paper grew by 22 per cent year-on-year, with exports to countries along the ‘Belt and Road’ route accounting for 58 per cent of the total.
IV. Future Outlook: Three Major Trends in Supply Chain Restructuring
Biodegradable Materials: The industrialisation of bio-based ceramic fibre paper will accelerate in 2025, with the proportion of R&D investment in eco-friendly binders expected to rise from 6 per cent to 15 per cent.
Hydrogen Energy Applications: Emerging demands such as thermal insulation for hydrogen storage and transport equipment and separators for sodium-ion batteries will create an incremental market worth 2 billion yuan.
Digital Supply Chains: AI predictive models will reduce raw material inventory error rates from 15 per cent to 5 per cent, whilst smart logistics will shorten delivery cycles by 30 per cent.
Amidst the wave of supply chain restructuring, ceramic fibre paper enterprises must use technology as their spear, compliance as their shield and integration as their chain in order to secure a commanding position in the global market. As the head of one enterprise put it: ‘Future competition will not be a contest between individual links, but a strategic game involving the entire ecosystem.’ Only by building a resilient supply chain can enterprises weather economic cycles and achieve sustainable development.