More than a month ago, the Hubei provincial government, a province with a large phosphorus resource, issued a “Opinion on Further Strengthening the Management of the Development and Utilization of Phosphorus High-Potassium Iron Oreâ€. The "Opinions" mainly have the following meanings: Starting from 2011, with the exception of the provincial-level geological prospecting fund projects, the examination and approval of exploration rights and mining rights for all minerals in the provincial-level phosphate ore planning area will be suspended; the gradual reorganization and closure of production capacity The phosphate ore enterprises with the annual output of less than 150,000 tons will concentrate the phosphate mineral resources in leading enterprises and large-scale key phosphorus chemical companies; during the “Twelfth Five-Year Plan†period, they will be proved by the provincial-level geological prospecting fund or by various levels of government investment exploration. Phosphate resources will be included in the provincial phosphate reserves, and phosphorus chemical companies will be encouraged to implement mergers and reorganizations to upgrade the existing phosphorus chemical industry. Conducive to sustainable resources. China Academy of Phosphate Fertilizer Industry Association Secretary General Xue Xuefeng told CCIN reporter that China's largest phosphate reserves are in four provinces, Yunnan, Guizhou, Sichuan, and Hubei. In addition, there are some in Hunan, and there are also some borders between Hebei and Inner Mongolia. These are areas where phosphate rock resources are relatively concentrated. Now Hubei regulates the exploitation of mining resources, which is consistent with the pace of integration of the phosphate fertilizer industry, because now the phosphate fertilizer industry is also mergers, reorganizations and alliances. Abrasive Sand Line Machine,Belt Grinder,Belt Grinding Machine,Belt Sander Grinder Taizhou Jiangzhou CNC Machine Tool Manufacturing Co.,Ltd , https://www.machinetzjz.com
The above content can be summarized as two words: limited mining, integration.
Perhaps the makers of the "Opinions" did not expect that the opinions of a province's resource management actually caused widespread discussion in the entire phosphorus chemical industry.
The hope that limited resources can be used in a more consistent view of the local industry is that the Hubei phosphate rock resources integration policy is beneficial to the protection of limited phosphorus resources and promote the healthy development of the industry, and is embodied in three aspects.
Li Zhongjun, deputy general manager of Hubei Xianyu Chemical Co., Ltd., said that there are many small mines in Hubei, and the phosphate rock in Hubei is dominated by medium and low grades, and there are more low grades. The current situation is that the local rich mines have basically been mined, and the distribution of some poor mines is not very uniform and is not suitable for centralized mining. Small mines naturally arise. Because some small mines are open privately, there will be some problems in terms of safety. Therefore, it is appropriate for the government to shut down small mines with a capacity of 150,000 tons/year or less. Mines are resource products and will surely become less and less in the future. It is a trend to strengthen management from the perspective of safety and close small mines.
"Closed 150,000 tons / year of mines, is conducive to the management of phosphate upgrades. Eliminating small mining companies, you can large-scale, deep processing of phosphate resources allocated to large-scale phosphorus chemical companies, give full play to the added value of phosphorus resources. "A person in charge of Hubei Huangmailing Phosphorus Chemical Industry Co., Ltd. said.
It is conducive to safe and environmentally friendly mining.
Zhou Junsheng, deputy general manager of Guizhou Kaishui Fertilizer Co., Ltd., believes that at present, many small phosphorus mines are developed by private households. Their mining is to eat dumplings and dig a hole to dig out the phosphorus resources. However, by destroying the entire resource structure in this way, no further mechanized mining is possible, and resources are left in the ground and cannot be reused. Originally, a very good mineral deposit, if one hole in the east and one hole in the west, will be thrown away, 60% of the resources will be thrown away, and only 40% will be excavated, resulting in waste of resources. And it is easy to cause ecological damage and form secondary disasters. "So, I think this policy is very good. It is a bit like Shanxi coal mine rectification, which can integrate small mines into large mines. The obvious subtext of this integration is not to do small mines and safety cannot be guaranteed; the second is to put phosphate rock. Resources are given to enterprises with a certain scale and technical support, so that the country's resources are guaranteed," said Zhou Junsheng.
Zhou Junsheng also said that the policy does not exist suspected of local protection. From the point of view of the entire document, first, resources are not without provinces. Second, to steer resources seriously is also to prevent associated and valuable resources (such as rare earths, iodine, etc.) from being wasted; and third, integration. The purpose is to protect the mine resources, and then reconstruct the mining rights and prospecting rights that were not issued in the past and integrate them into capable enterprises. This can achieve reasonable exploitation and scientific assessment and protect the ecology.
It is beneficial to the adjustment of the phosphorus chemical industry.
A person in charge of a phosphorus chemical company stated that Hubei's reorganization and shutdown of phosphate ore enterprises with a production capacity of 150,000 tons/year or less is necessary to avoid “abandoning poverty and abandoning poverty†and achieving sustainable exploitation of phosphorus resources. This will be beneficial to the long-term development of the domestic phosphorus chemical industry, and it will also benefit the company itself to achieve a virtuous circle.
Peng Weiyang, vice president of management and control of Sichuan Chuanheng Chemical Co., Ltd., told CCIN that after the “Eleventh Five-Year†development, some large-scale production capacity in the chemical industry has become oversupply, especially phosphorus chemical products, from the “12th Five-Year Plan†and “Industry Structure Adjustment Guidance. According to the Catalogue, new projects in some industries have been included in the scope of restrictive development, indicating that new projects in these industries should cool down, maintain existing scale, and strengthen the industry. Based on this idea, Hubei decided to limit the scale and quantity of mining at the source, in line with national industrial policies.
Concerned about bullying small mines for local protection However, some people in the industry believe that although the motive of the policy is to protect resources, it may not be appropriate to simply restrict enterprises from scale.
According to Xuefeng analysis, the purchase of large-scale phosphorus chemical companies is now done by themselves. They are engaged in docking with large mines. Because of the large demand, raw materials must ensure production, and small mines cannot meet their production needs. Therefore, they generally do not sign contracts with multiple small mines. This is not economical. Therefore, the integration policy has little impact on large-scale phosphate fertilizers and phosphorus chemical companies. But small businesses can't say it.
“Restricting the scale is one way. But from our industry and other industries, this is the case, that is, small scale does not mean that it is not economical. Of course, the bigger the scale, the stronger its own strength is, and he has The strength of funds to increase the investment in safety and environmental protection facilities, small businesses may not have this strength. But the mere limitation of the scale may not be appropriate, there may be some additional conditions." School Xuefeng believes. She said that if a small mine is shut down due to environmental protection, or safety production is not up to standard, it can be said that nothing wrong. However, if it is simply because the scale does not meet a certain standard, it restricts mining or shutting down. This is logically impossible to say. Companies may not be convinced.
Xuefeng Xue told CCIN reporters that the characteristics of the phosphate rock in Hubei are that the grade is lower and the impurity content is higher, but the transportation conditions are better than Yunnan and Guizhou. The local government’s current practice will have an impact on some phosphate producers that do not have resource allocations, including the province, because they cannot buy minerals. This is just like the reorganization of small coal mines. However, it is hard to say how much authority it can have and how far it can be implemented. “Because, for some regions, phosphate deposits below 150,000 tons/year may not be a big deal; for some remote areas, such a mine may be the backbone of their local economy. It is necessary to shut it down. The local government may not be willing to shut down. If there is a need to shut down these phosphate mines, there should be some complementary measures. For example, what happens after the people are shut down and what should be done if the remaining unmined mineral resources are handled? It should not be a simple administrative order.
A person in charge of a phosphorus-free chemical company without resources is thinking deeper. He said that since the beginning of this year, the price per ton of phosphate rock has risen by 300 yuan, but the quality has been declining. They are in favor of the government's necessary guidance, but excessive interference in the market has disadvantages and no benefits. “Our phosphate-free province’s chemical companies are most concerned about the local restrictions on phosphate rock out of the province and engage in so-called in-depth processing. As we all know, China’s phosphate mines are limited to a few provinces such as Hubei, Yunnan, Sichuan, and Guizhou, and are located in the upper reaches of the Dajiang River. If phosphorus is processed in the province of phosphorus, it will not only violate the basic rules of the market, but will also be detrimental to local environmental protection. In addition, chemical companies that have invested heavily in construction throughout the country during the “Seventh Five-Year†and “Eighth Five-Year†periods are facing In the dilemma of rice pots, the purchasing pressure of phosphate rock has always been the sword of Damocles, which is overhanging the top of the enterprise and the long-term development has been greatly constrained, so the phosphate-free chemical companies in Shandong, Shanxi, Henan, Anhui, Jiangsu and Jiangxi The greatest wish is to share the phosphate resources and market prices, and we will openly compete on a relatively equal platform," said the person in charge.
The price increase and chain effect have already appeared to be understood by CCIN reporters. Although Hubei's "opinions" were introduced for only a month or so, follow-up impacts have begun to show.
The first is the increase in the price of phosphate rock in Hubei.
Shen Jiankun, deputy general manager of Phosphorus Fertilizers Jiangsu Middle East Group Co., Ltd., told CCIN: “When we purchase raw materials in Hubei, the supply situation is fine, that is, prices have risen, which has caused our costs to rise. The price of future phosphate rock may also be higher. Rising, the limited mining of phosphate rock in Hubei is very unfavorable to our raw material procurement, and now we can only find ways to purchase raw materials.As far as I know, the phosphate rock mining limit measures in Hubei are not available to phosphorus chemical enterprises in the lower reaches of the Yangtze River. Raw material procurement is very unfavorable."
Li Zhongjun also stated that because of this integration policy, the supply of raw materials in the upper reaches was reduced, and there were so many downstream companies demanding goods, the original balance was broken, and the price of phosphate rock was pushed up. At present, the effect of limited mining has fully emerged. Local enterprises are relatively better, but the impact of raw material prices is still there. Because of the limited mining measures in Hubei, the price of phosphate ore has risen recently. In early September, the price of local phosphate rock in Hubei was raised by RMB 30/t on the basis of an increase of RMB 80/ton. The output price of wells has reached 500 yuan. /Ton. Things are rare and precious. Now it is immediate.
A person in charge of Hubei Xiangyun Group Co., Ltd. also said that due to the policy, their phosphate rock raw material prices have recently risen by 50-80 yuan/ton.
Due to the price increase of phosphate rock in Hubei, some phosphorus chemical companies started to find another way out.
Because the integration of phosphate resources in Hubei resulted in a reduction in supply, many phosphorus chemical companies turned to Yunnan, Guizhou and other places to find raw materials. A person in charge of Hubei Sandeli Fertilizer Co., Ltd. told CCIN that the limited mining policy in Hubei has had an impact on the procurement of raw materials. At present, they only source raw materials from Yunnan, Guizhou and Sichuan. A person in charge of a phosphorus chemical company in Sichuan also said that according to his understanding, some Hubei enterprises have recently purchased phosphate ore from Yunnan and Guizhou. Although there are Phosphorus Fertilizer Plants in Hubei, there are Phosphorus Chemical Plants in Chengdu, but instead they go to Guizhou to purchase. The Jiangsu Middle East Group also has factories in Hubei Province. Because of the expansion of production capacity, Hubei has also reduced its consumption of porridge, and has also purchased products from other provinces.
However, another way out has brought new problems. That is, the price of phosphate ore in Yunnan, Guizhou and other places began to rise, or limited supply of products.
A deputy general manager of Jiangxi Guixi Chemical Fertilizer Co., Ltd., responsible for raw material procurement, told CCIN reporters that as a phosphate compound fertilizer production enterprise, the direct effect of Hubei's phosphate mining limit mining measures on enterprises was not significant, but there was an indirect impact, which was to create a market. The supply of phosphate rock was tight and the price of raw materials for phosphorus and compound fertilizers formed. “We are now mainly starting from Guizhou Province. As Hubei adopted limited mining measures, the price of ore in Hubei rose by RMB 50 per ton on September 1. This led some phosphate and compound fertilizer companies in Anhui and Jiangsu to Yunnan and Guizhou. Buying ore, that is, transferring purchases, currently the phosphate ore prices of the three large-scale phosphate ore enterprises including Phosphorus, Phosphorus, and Kunyu Iron have not yet risen. However, due to the large number of people buying, they have started to limit the amount of ore deposits and have become expensive to us. We can guarantee 20 wagons a day, but we can only guarantee the basic supply, but this is already a face to take care of our old customers, so at the moment we would like to save some more phosphate ore, because the wagon cannot be lifted. The wagons of Sinotrans are also very tense and difficult to ship, and in addition, some small and medium sized phosphate ore enterprises in Yunnan and Guizhou are planning to increase their prices because the price of phosphate rock in Hubei has risen, and some of them are privately-owned joint-stock companies. There is no way to explain to shareholders that the phosphate prices in these areas are expected to rise with the market."
Enterprises should not expand production and should be transformed as soon as possible Many in the industry said that phosphate resources are non-renewable after all, and therefore will become increasingly scarce in the future. Phosphorus-related chemical companies should make preparations early and pay attention to transformation.
According to Xiufeng, the original phosphate-producing provinces have no restrictions on the province's phosphate rock, but in recent years, some provinces have taken some measures. For example, Yunnan Province has some restrictions on the amount of phosphate rock out of the province and it has been implemented for several years. Because Yunnan's own processing capacity is very large, there are not many extra phosphate rocks, and there have been few Sinotrans shipments. Therefore, phosphate fertilizer plants currently built in areas with no resources often have strained supply or high prices. She believes that the domestic phosphate fertilizer production capacity is now very large. From a long-term perspective, companies without resources, including those without phosphorus resources and sulfur resources, will find it difficult to survive. This is an inevitable trend. Now, in regions without phosphorus resources, no new ammonium phosphate plant has been allowed to be built. These enterprises must certainly consider the transition, make other products, and make plans early. They cannot wait until there is no rice squatter.
Peng Weiyang also stated that if the phosphate ore raw materials are purchased, the cost of producing 1 ton of ammonium phosphate will increase by several hundred yuan, and the transportation cost will offset the profits. Finally, even the porter’s money will not earn enough. Therefore, phosphorus-chemical companies affected by the policy should no longer continue to expand production capacity, but must do a good job of existing products.
There are also industry insiders telling CCIN that the China Chemical Mining Association recently announced the “Twelfth Five-Year Development Plan for Chemical Industry Mining,†which will increase the status of phosphate resources to an unprecedented level. The plan proposes that in the next five years, it is necessary to establish a mechanism for the reserve of phosphate mineral resources and increase the access threshold for phosphate mining. The policy of Hubei is the first step for the integration of phosphate rock. The relevant chemical companies should respond in a timely manner and begin the transition as soon as possible.