CCM>Free Info >News Update>2nd volume No.4>
Last Update: Dec 31st, 2001
Fine Chemicals & Basic Chemicals
Sample of Market Analysis
 
I. News Collection
 
Base Oil Quality Modification Process in Trial Operation (Last Update: 12/06/2001)
A 200,000MT/year base oil quality modification process by hydrogenation method in Jinmen Petrochemical General Factory has been started up successfully. This ends the history that China can not supply high quality base oil for the lubricant production. It is reported that the processing technology of base oil is one of the important subjects during the Ninth-Five-Year Plan. The base oil hydrogenation technology comes from China Petrochemical Science & Technology Research Institute. The process is designed by China Petrochemical Engineering Construction Corporation. It is reported that by undergoing a series of catalytic reactions (hydrogenation saturation, ring opening, cracking, isomerization), the nonideal components in the base oil are turned into ideal components. The base oil by this method complies with the VHVI standard.
 
Fushun Finishes the Styrene Enlargement (Last Update: 12/05/2001)
Fushun Petrochemical Co., Ltd. invested RMB35.78 million to enlarge the styrene capacity from 30,000MT/year to 60,000MT/year. They use three sections negative pressure dehydration technology. The styrene from the enlarged process is proved to be qualified. So far all the styrene in this company is for captive consumption to make polystyrene.
 
Chinese Butanone Industry Encountering Pressure (Last Update: 11/29/2001)
Being an ideal substitute to benzene, xylene, and toluene, butanone (methylethyl ketone) has been developed fast in the oversea countries. But due to the fact that the production technology has been monopolied by oversea companies, the production of butanone in China has been quite small in the past few years. So far there are only two lines that conduct commercial production and the total production capacity is around 20,000MT/year. Every year China has to import around 80,000MT to meet the demand from Chinese market. So some Chinese companies plans to build production line of butanone in the near future. It is expected that the total production capacity of butanone, after the finish of these projects, will be 100,000MT/year. China has seen the progress that Chinese companies made in the research and production of butanone. At present the production cost from Chinese companies is RMB5,500/MT, including RMB3,000/MT of raw materials. But since November 2001 the price of import butanoe went down sharp and it nearly went to RMB6,000/MT. It is unavoidable that a severe competition is to happend in the next years following.
 
Chinese TDI Manufacturers Encountering Difficulties (Last Update: 11/22/2001)
The price of TDI has been remaining at low price in the past year. In addition the struggling of TDI, which is allured by the large demand in China, makes the TDI price from Chinese manufacturers less competitive in the market. So far the major Chinese suppliers, Cangzhou Dahua and Gansu Yinguang, have met difficulties that they never encountered before. There are much more stock in the factories and it delays the normal capital withdrawal. Both of them express strong expectation on the central government to take action against the struggle activity.
 
Qilu-Eastman JV Project Undergoing Smoothly (Last Update: 11/22/2001)
SINOPEC Qilu Petrochemical is negotiating with Eastman of USA for the joint venture project, Texanol ester alcohol, and TXIB plasticizer which is used in the field of coating, PVC & PU industry, respectively. The feasibility study report has been submitted for approval and the negotiation for the joint venture issue has been undergoing smoothly. It is expected that the joint venture will be approved by end of 2001 and the construction will begin in early 2002.
 
Chuyuan K Acid Production Line Launched Trial Production (Last Update: 11/14/2001)
The first phase of K acid production line in Hubei Chuyuan Group is nearly finished recently. The trial production is launched and is proved to be qualified. It is reported that the production capacity of the first phase is 3,000MT/year.
 
Haihua Kuixing Plans to Introduce Melamine Technology from DSM (Last Update: 11/13/2001)
Shandong Haihua Kuixing Chemical Co., Ltd has reached agreement with Taiwan Fertilizer Co., Ltd. to introduce melamine technology and key equipment from DSM of Holland. According to the agreement, the total investment for this project is estimated to be RMB150 million. The total production capacity of melamine will increase from 12,000MT/year to 47,000MT/year. It is expected that the annual turnover will reach to RMB108 million, after the enlargement.
 
High Purity Potassium Hydroxide Project Activated in Chengdu (Last Update: 10/30/2001)
The high purity 30,000MT/year potassium hydroxide project in Chengdu Huarong Chemical Co., Ltd. was initiated recently. The total investment for this project is USD29 million. The annual turnover of this project will be RMB800 million after it is finished in October 2002. Chengdu Huarong Chemical Co., Ltd. is invested by Chengdu Chemical Holding Co., Ltd., New Hope Group and International Financial Corporation (IFC). The Chinese partners hold 75% shares while IFC holds 25% shares. The joint venture is operated by New Hope Group. High purity potassium hydroxide is used in ABS, high purity alkali battery, pharmaceutical intermediate and food additive.
 
Large Melamine Project Activated in Henan (Last Update: 10/29/2001)
Henan Zhongyuan Dahua Group Ltd. introduced technology and equipment from Eurotecnica of Italy in 1999 to set up a 12,000MT/year melamine production line. Zhongyuan Dahua uses the side product from the urea production line as raw material. In 2000 they produced 10,066MT melamine and earned RMB11,04 million of profit. In order to optimize the facility and lower the production cost they decided to enlarge the production capacity of melamine. The feasibility study has been approved by concerning authority and the enlargement started on Sept 26th 2001. According to their plan Zhongyuan Dahua will continue to cooperate with Eurotecnica of Italy and the melamine capacity will be increased from 12,000MT/year to 30,000MT/year. The total investment for the enlargement is RMB190 million. It is expected that the enlargement will take 20 months. The annual income from melamine will increase by RMB100 million and the annual profit will increase by RMB20 million.
 
4,000MT/year Dimethyl Carbonate Line Finished in Xinshan (Last Update: 10/25/2001)
The State Important Industrial Test Project, 4,000MT/year dimethyl carbonate project in Hubei Xingshan Xinglihua Chemical Co.,Ltd., has been finished successfully. The assay can reach to 99.9%. The technology comes from Middle China University of Technology, using carbonyl oxidation method.
 
Benzoic Acid Series Products in Qingdao Sanli (Last Update: 10/23/2001)
Recently Qingdao Sanli Chemical Co., Ltd. has finished the enlargement project of para-methyl benzoic acid, m-methyl benzoic acid and 3,5-dimethyl benzoic acid. The capacity of these product has been increased to 1,000MT/year, 1,000MT/year and 600MT/year, respectively. In addition, this company cooperated with Sichuan University, Dalian Science & Technology University and Qingdao Chemical College and developed successfully some fine chemicals like benzoyl chloride, 3,5-dimethyl benzoyl chloride, each of whose production capacity is over 1,000MT/year.
 
Sanwei Group Conducting Technical Innovation (Last Update: 10/20/2001)
Shanxi Sanwei Group is going to conduct technical innovation on 5 items: 1,4-butanediol, tetrahydrofuran, RTMEC, gamma butyrolactone, sodium diacetate. The 1,4-butanediol project is the largest innovation project and is expected to be finished in 2002.
 
Three Projects Launched in Tianli Company (Last update: 10/13/2001)
The construction of 30KT/year butanone project started recently in Xinjiang Dushanzi Tianli High-Technology Company. Along with this project, two other projects were also activated, they are 30KT/year MTBE, 50KT/year secondary butyl alcohol. The total investment for these three projects is RMB268 million. It is expected that these projects will be finished in Oct 2002.
 
Liangjiang Chemical Promotes Acrylamide in International Market (Last Update: 10/13/2001)
Jiangxi Nanchang Liangjiang Chemical Co., Ltd. is a joint venture of Jiangxi Changjiu Agricultural Chemical Co., Ltd. and Jiangsu Nantian Group Co., Ltd., who both produce acrylamide (crystalline) by microbiological method. The total production capacity of acrylamide in these two companies is 16,000MT/year, the largest production base of the same in China. Jiangxi Nanchang Liangjiang Chemical Co, Ltd. is responsible for the sales of acrylamide from these two companies. Liangjiang Chemical cooperates with the foreign trade companies at home and abroad to distribute the acrylamide in America and Southeast Asia.
 
Three Projects in Dushanzi Tianli Company Activated (Last Update: 10/13/2001)
The 30,000MT/year methyl ethyl ketone project in Xinjiang Dushanzi Tianli High Tech Co., Ltd. has been activated recently. Accordingly two other projects in this company also started up. They are 30,000MT/year MTBE, 50,000MT/year secondary butyl alcohol. The total investment for the three projects is RMB268 million. It is expected that these projects will be finished in October 2002.
 
China to Conduct Antidumping Investigation of Acrylic Acid (Last update: 10/11/2001)
On October 10th, State Foreign Economic & Trade Commission announced to start antidumping investigation of acrylates made from South Korea, Maylasia, Singapore and Indonesia. China will investigate the damage of the acrylates from these countries to the Chinese manufacturers. These is the second time in China for the antidumping investigate of acrylates. The first one happened in November 1999 in respect to the acrylates from Japan, USA and German. The result is that China started to levy antidumping tariff to the acrylate from the Japan and USA since November 23rd 2000. After the first anitidumping action it was found that the import of acrylates from other countries began to increase abnormally. So some concerning Chinese manufacturers suited to cournt for antidumpting investigation once more. The acrylates products in this investigation include: methyl acrylate, ethyle acrylate, n-butyl acrylate, 2-ethyl-hexyl acrylate.
 
Chongqing Becomes the Largest Investment Base of BP (Last Update: 10/10/2001)
In 1995 BP cooperated with SINOPEC Sichuan Vinylon Factory and Chongqing Construction & Investment Company to set up Yangzijiang Acetyl Chemical Co., Ltd. The total investment for the joint venture was USD200 million. The comercial production started in 1998 and the total profit in that year is USD3 million. This is the largest investment of BP in China. In the past few years the production capacity of acetic acid has increased from 150,000MT/year to 200,000MT/year. They claims to have occupy 30% of Chinese market. It is reported that the second phase, 80,000MT/year acetate project, will be activated in 2002 and will be finished by June 2002. In addition, Yangzijiang Acetyl Chemical Co., Ltd. decides to further enlarge the production capacity of acetic acid to 350,000MT/year. The enlarge project is expected to be finished in early 2003. The raw materials are still natural gas and methol from Chongqing area.
 
Yangzi-BASF Project Activated (Last Update: 10/01/2001)
"In June 2001 Yangzi signed a contract with BASF to build 9 processes in the joint venture. The joint venture is called BASF-YPC Company Ltd., simply Yangzi-BASF. The total investment for these projects is USD2.65 billion. Yangzi and BASF each invests 50%. They will use the key facilities from Pan Pacific Petrochemical of Indonesia. The facility and the technology are all from the unfinished project in Indonesia. Yangzi-BASF explained that by using this package of facilities they can save 35% of cost. On 28th Sept 2001 the construction of the Yangzi Petrochemical-BASF project began. It is expected that this project will be finished in 2004.
 
The Construction of 600,000MT/year Fuel Alcohol Started Up in Jilin (Last Update: 09/25/2001)
The construction of 600,000MT/year fuel alcohol project in Jilin Fuel Alcohol Co., Ltd. started up on Sept 22nd 2001. This symbolizes that a large energy industry base and corn deep processing base will form in the near future. This project was approved in December 2000 and is one of the top ten projects in China in 2001. It is invested by China Natural Gas Corporation, Jilin Grain Group Co., Ltd. and China Huarun Corporation. The total investment for this project is RMB289 million. According to feasibility study, there are 9 facilities in this project including fuel alcohol production line, DDGS production line, refined corn oil workshop, zymin workshop, power plant, access railway, electricity substation, water treatment station and sewage treatment station. This project is expected to be finished in 2003. After finish it will consume 1.92 million MT/year of corn, producing fuel alcohol (600,000MT/year), DDGS (573,800MT/year), corn oil (45,000MT/year), air brick (175,300 cubic metric meter/year) and road material (183,100MT/year).