As the world's nickel ore has been running scarce, a patented technology with a breakthrough in the utilization of low-grade nickel oxide ore is expected to provide a solution for China's stainless steel sector which is faced with soaring ore prices on the international market and urgent domestic need. On May 28, the owner of the patent, Huaguang Smelting Group Ltd., a private company from Zhejiang Province, China, released in Beijing a "new technique to obtain ferronickel from nickel oxide ore through blast-furnace smelting". The company also announced that it would take measures to safeguard its intellectual property.

The global stainless steel market witnessed a vigorous seller's market in recent years, and demand was growing rapidly in China. According to the data of the National Development and Reform Commission, China's apparent stainless steel consumption reached 6,150,000 tons in 2006, marking the sixth consecutive year that China topped the world in consumption. China's demand greatly spurs the market demand for the base material – nickel, leaving the global nickel price to continue to rise and restricting the stainless steel sector in China. A study by the stainless steel branch of the China Iron & Steel Association shows that the existing domestic production capacity in stainless steel smelting is around 10,000,000 tons, which has exceeded that of Europe, and that of the United States and Japan combined. However, China produced only 5,300,000 tons in 2006. Experts say that China's huge production capacity has not been realized primarily because of the serious insufficient nickel supply.

As is known that China must mainly rely on imports for its nickel demand. Presently global nickel resources are divided into two categories. One is the superior nickel sulfide ore, such as China's Jinchaun Nickel Mine, for which the processing techniques have matured,. The long period of consumpution has resulted in a global crisis with respect to nickel sulfide, and low-grade nickel oxide ore have been more favored. However, 70% of the abundant nickel oxide ore has not been effectively tapped due to technical limitations. The development of nickel oxide has been included as "a key project" in China's Medium and Long-Term Development Plan for Nonferrous Metals Technology (2006-2020) (the opinion-soliciting version).

Around the world, nickel oxide ore is processed mostly through hydrometallurgy or arc-furnace smelting to extract the nickel. However, both methods are defective, because, among other things, they require: higher-grade ores and a certain silicon/magnesium ratio or silicon/iron ratio; low ratio of the overall utilization of the mine run; many metal constituents discarded together with slag and waste; a huge investment in facilities; high energy consumption; serious environmental pollution ; low utilization rate of equipment and machinery; and limited productivity. Regarding the above, Mr. Liu Huoguang, the founder and legal representative of Huaguang Group, with his tens of years of experience, came up with the idea of smelting nickel oxide ore with a blast furnace as the main equipment and coke as the heat source.

As a matter of fact, before Liu's success, there had been other companies and firms which tried Liu's method. However, they soon lost interest since the key technology could not be invented and "cold furnace" accidents occurred. Through careful computation, scientific demonstration, and trials and errors, Liu succeeded in solving the key issue of poor fluidity of molten iron containing chrome and then the problem with dephosphorising inside the furnace. It is a breakthrough to the bottleneck of traditional technology in the comprehensive utilization of nickel oxide ore. Currently, with the completed techniques for ferrous nickel through blast-furnace smelting of nickel oxide, Liu has applied for invention patents in China and also has started a PCT application, and been granted "the technique to obtain nickel chrome cast iron through blast-furnace smelting of nickel oxide ore containing crystalline water" and "the technique to obtain nickel chrome cast iron through blast-furnace smelting of nickel oxide ore not containing crystalline water".

Once put on the market, Huaguang products were immediately acclaimed. The development of low-grade nickel oxide ores worldwide is thus pushed forward. However, Huaguang Group is confronted with infringements after the success came. According to Liu, a number of manufactures have illegally employed Huaguang's patented techniques and produced nickel chrome cast iron without permission. They have not only infringed Huaguang's intellectual property rights and caused huge economical losses to the patentee, but have also set a bad example for the healthy development of the industry. Therefore, Liu said that he will seriously pursue legal measures to protect his intellectual property rights.