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Overcapacity China's soda industry continued to downturn recently

wallpapers News 2020-09-01
On March 14, the online price of soda ash of Shong Haihua Co., Ltd. (hereinafter referred to as "Shong Haihua") was 1350 yuan / ton. But the actual sales price including tax is only about 1250 yuan per ton. Wu bingshun, Secretary of the board of directors of Shong Haihua, told the economic observer that the cost of the company is about 1300 yuan at present, transactions below 1300 yuan are not profitable. The main downstream of

soda ash is glass, printing dyeing, phosphate, small chemical industry, etc. While the downstream downturn, dem sharply reduced. Under the national real estate regulation control policy, the real estate industry has been cooling down rapidly, the number of new construction projects has been greatly reduced, which directly leads to the sharp decrease in the dem for glass in the real estate industry. At the same time, the domestic printing dyeing industry is experiencing a downturn, which makes the downstream dem of soda ash industry greatly reduced. After the financial crisis in 2008, soda ash enterprises with a production capacity of 1.2-1.3 million tons have been put into operation one after another, resulting in the current total production capacity of the industry may exceed 30 million tons, which is in serious contradiction with the actual dem of 20 million tons. According to the data of

business agencies, the reference price of soda ash on March 12 was 1263.33 yuan per ton, which has dropped by 4.172% in the past 10 days since March 3, 2013. In 2012, the domestic soda ash market showed a downward trend in the whole year, the decline rate of light soda ash was 23.78%. Domestic heavy soda ash also showed a downward trend, with a decrease of 27.73%.

on the afternoon of the 14th, the group meeting of Haihua, Shong Province, held an afternoon, hoping to discuss a solution on how to get rid of the loss this year, but "how to do it? The pressure is really high. " Wu bingshun said.

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in 2012, the loss of Shong Haihua reached 520 million, which is the second high loss after 2009, also the most serious one.

Wu bingshun said that the company's performance in 2011 was fairly good. Because the first three quarters of 2011 were profitable, but in the fourth quarter, they made less. However, from the fourth quarter of 2011, the market gradually turned into a downturn, the price continued to decline in 2012. "This is the situation of the whole soda industry. And the company's production process is set, now changing the production process is not realistic. Innovation technological transformation will not solve the big problems. Changes in management methods can't be implemented easily, nor can we lay off staff. It's really difficult. " Wu even hopes that reporters can help to provide some policy industry information solutions.

Shong Haihua is an enterprise with soda ash as the leading product. Ms. Li, a sales person of Shong Haihua soda factory, said that the price had been falling in the previous period. Although the sales volume was not much less, it had been doing business at a loss.

Wu bingshun said that the more sales, the more losses, the company also moderately controlled the production capacity, with a normal production capacity of about 2.5 million tons. Last year, the output was controlled within 2.3 million tons, but the overall sales volume did not decrease much.

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soda production process can be divided into ammonia alkali process, combined alkali process natural alkali process. The proportion of natural alkali process is limited its influence on the market is limited. However, compared with the ammonia alkali process, the production cost of the combined alkali process is about 200 yuan / ton lower, mainly because it can make some money from the by-product ammonium chloride product of soda ash production. In addition, the market of ammonium chloride is good recently, the production enterprises of combined alkali process can still make some profits in the downturn. Shong Haihua, with ammonia alkali process as the main process, felt that the days were more difficult. Wu bingshun said that it is difficult to estimate how long such a low level will take, it will lose money at this price.

in 2012, seven of the 10 major holding subsidiaries of Shong Haihua Company suffered losses, one of which had a profit of 0, only two achieved a small profit. The company has taken some self-help measures, such as downsizing selling non main business assets.

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Shong Haihua Company had 7647 registered employees at the end of 2012, a decrease of 652 compared with 2011, with a decrease rate of nearly 8%. In January 2012, it successfully transferred Shong Haihua Shengxing Chemical Co., Ltd., which had the largest loss in 2010, increasing the net profit by 18.016 million yuan. In addition, the equity of Weifang QINLE animal husbry Co., Ltd., a secondary subsidiary, was transferred, Shanghai Yuu Chemical Trading Co., Ltd. was cancelled.

Wu bingshun said that the company did not lay off staff, there were two main reasons for the reduction of employees. One was the equity transfer of non main business subsidiaries, which naturally reduced the number of employees; Haihua Group carried out legal compliance equity transfer for some non main business enterprises, the involved personnel took internal placement voluntary termination of contract on the basis of respecting the wishes of employees. There are about 400-500 people in this section. Second, the normal retirement resignation of the company's employees. "In doing so, the company also adheres to the principle of highlighting the main business. With the sale of assets, the number of personnel will be correspondingly reduced, so as to achieve downsizing natural downsizing." Wu bingshun said. The industry of

has gone astray. It is not only Haihua of Shong Province that has a hard time, but also the whole soda ash industry has maintained the situation of poor operation. A-share listed companies have announced the annual report of 2012 of several soda enterprises, all of which are in the channel of profit decline. Among them, Qingdao Soda Industry has a loss of 255 million yuan, Sanyou chemical's net profit has decreased by 81%, Hebang's net profit has decreased by 20%. Although Shuanghuan technology is supported by ammonium chloride products, its profit is expected to be only 0-10 million yuan. The company's net profit in 2011 was 354 million yuan.

in the soda industry situation is overcapacity, prices continue to be low, but domestic new soda ash projects are still in production. According to industry statistics, the total capacity of soda ash industry has reached 28-30 million tons. However, the actual market dem is only 20 million tons, the situation of overcapacity is very serious. There are many complaints about the current overcapacity situation in the

industries. An executive of Haihua in Shong Province admitted that the national development Reform Commission could not approve the 600000 tons of soda ash plant in 2004, asked the State Council Office for research approval. This overall balance played a key role in controlling production capacity. However, after the financial crisis in 2008, soda ash enterprises with a production capacity of 1.2-1.3 million tons have been put into operation, resulting in the total capacity of the industry may exceed 30 million tons. This contradiction between dem overcapacity is becoming more more prominent, which has a great impact on the industry.

businessShe Baoxia, a social analyst, said that affected by overcapacity, the market for homogeneous products was crowded the market caused low price competition. The main downstream of soda ash is glass, printing dyeing, phosphate, small chemical industry, etc. While the downstream downturn, dem sharply reduced. Under the national real estate regulation control policy, the real estate industry has been cooling down rapidly, the number of new construction projects has been greatly reduced, which directly leads to the sharp decrease in the dem for glass in the real estate industry. At the same time, the domestic printing dyeing industry is experiencing a downturn, which makes the downstream dem of soda ash industry greatly reduced. At present, the operating rate of soda ash industry is maintained at about 70%, most enterprises produce at low load.

for the future of soda ash industry, pessimistic industry insiders believe that the industry has serious overcapacity, it will take at least two years to digest the existing inventory, some enterprises can only change production, otherwise they may be eliminated by the market. Qingdao Soda Industry is not optimistic about the prospect of the industry, the business plan they formulated for next year is "the total loss will not exceed 160 million yuan".

but Shong Haihua thinks that there are still opportunities. With the continuous implementation of the national affordable housing construction the continuous expansion of the scale, the promotion of urbanization, it will drive the rapid development of the downstream industry of soda ash, especially the glass industry, also bring opportunities to the soda industry. The market dem for soda ash is increasing year by year, which helps to alleviate the overcapacity in China's soda ash market. "


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TRUNNANO (aka. Luoyang Tongrun Nano Technology Co. Ltd.) is a trusted global chemical material supplier & manufacturer with over 12 years' experience in providing super high-quality chemicals and Nanomaterials. The nitride powder produced by our company has high purity, fine particle size and impurity content. Please contact us if necessary.
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