Urea market achieves qualitative leap

In the first half of 2012, domestic urea prices steadily progressed in the midst of overcapacity, especially since the end of March to mid-May, which broke the pattern of low urea prices in recent years. According to relevant data, during the 12th Five-Year Plan period, China’s new urea capacity will reach 41.2 million tons; by the end of the 12th Five-Year Plan period, China’s urea production capacity will exceed the 90 million tons mark, and excess capacity will reach 30 million tons. China's urea industry is shifting from quantitative growth to a qualitative leap.

First, large-scale enterprises are aiming at the top 20, and the construction of the project is on the rise

On the eve of “11,” Hebei Provincial Governor Zhang Qingwei visited Yangyang Zhengyuan Chemical Group to inspect “24·40” (240,000 tons of synthetic ammonia and 400,000 tons of urea, the same below) project site, and encouraged Yang Zhengzheng to seize it. Opportunities accelerated the construction of the 60.80 project in Ganzhou.

“The 60.80 project mentioned by Governor Zhang was the 600,000 tons of synthetic ammonia and 800,000 tons of urea project invested by Yangyuan Zhengyuan Fertilizer in Lingang Economic and Technological Development Zone of Zhangzhou, which is the focus of Yangmei Group and Hebei Province. Project.” said Liu Jincheng, president of Hebei Zhengyuan Chemical Group.

For this project, Yan Xiping, general manager of Yangmei Group, commented: “This project blew the horn of Yangmei Coal Group's high quality to the top 20 in the nation's nitrogen fertilizer companies.” Yan Xiping described the blueprint for the top 20 to the author: “ During the 12th Five-Year Plan period, Yangmei Coal Group will implement a new urea production capacity of 2 million tons by reorganizing domestic and foreign urea enterprises, and plan to build 1 million tons of urea base in Ganxian County until the completion of the Ganzhou 60.80 project in 2014. The annual production capacity of urea will reach 7.5 million tons.

Like Yan Xiping, Fan Jinjun, chairman of Henan Jinkai Chemical Investment Holding Group Co., Ltd., and Tan Fuyuan, chairman of Jiangsu Linggu Chemical Co., Ltd., also expressed the desire of the “Twelfth Five-year” companies to become one of the top 20 nitrogen fertilizers.

“The 12th Five-Year Plan of the Chemical Fertilizer Industry pointed out that by 2015, 80% of China's nitrogen fertilizer production will be concentrated in 20% of the enterprises. I hope that 20% of the companies will have open access to them, and they hope to expand into 20 companies with core competition. One of the large-scale nitrogen fertilizer enterprise groups." Fan Jinjun said. According to Fan Jinjun, Jinkai Group is currently constructing a total ammonia project of 1 million tons. Its annual production capacity of single synthetic ammonia is 600,000 tons. It is currently the largest domestic ammonia synthesis plant with coal as raw material. "It is expected that the production capacity will be fully released in 2013. By the end of the Twelfth Five-Year Plan, total ammonia production of the company will reach 2.6 million to 3 million tons, and the scale of production and operations will exceed 10 billion yuan," said Fan Jinjun.

When talking about future developments, Fu Yuan stated that during the “12th Five-Year Plan” period, the signs of atrophy of the ammonia industry in the areas south of the Yangtze River were already very obvious. The new installations have room for development and the market prospects are good. “We will seize the opportunity and prepare for another 45.80 project, so that the company will truly become one of the 20 large-scale nitrogen fertilizer companies cultivated by the industry at the end of the 12th Five-Year Plan period,” said Tan Fuyuan.

Along with the ambitious development aspirations of large companies, the author discovered in the survey that after entering the “Twelfth Five-Year Plan”, under the promotion of many central enterprises, coal enterprises, and well-known enterprises, a number of urea projects are coming up. The common feature of the project is the enlargement.

The 800,000-ton urea project, which was built by CNPC Ningxia Petrochemical Company with an investment of RMB 2.522 billion, is expected to be completed and put into operation in the first half of 2013; Guodian Chifeng Chemical Co., Ltd. will build 1.3 million tons of urea base in Chifeng City; Jizhong Energy Xingkuang Group In the same scale base in Wuyuan, Inner Mongolia, Phase I of the 520,000 tons urea project is expected to be put into operation before the end of this year, and 800,000 tons of the second phase will be put into operation in 2015; China Coal Ordos Energy Chemicals Co., Ltd. is planning and constructing in the Ordos Tuoke Industrial Project Area. With an annual output of 200·350 projects, the construction scale of the first phase of the project is 100·175 projects, the construction period is 33 months, and the project is put into production in 2014; Wulan Coal Group Co., Ltd. invests and builds the 135·240 project in Ordos, which is the largest in the world The urea project is expected to be fully completed in October 2014; Huahe Coal Chemical Co., Ltd. 30.52 project, the main device was started in June, is expected to put into production in 2014; China North China Huajin Chemical Industry Group Huajin Chemical Industry Co., Ltd. Huajin Chemical Co., Ltd. The company implemented the 100·160 project in Xilin Gol League and completed production in 2015.

These projects are only part of the large-scale urea projects under construction or planning and construction in China. Industry insiders told the author that the construction scale and opening density of this large urea project is the first time in the history of urea development in China.

With the construction and commissioning of large-scale projects, the layout of China's urea industry will also undergo some changes. New production capacity in the “Twelfth Five-Year Plan” will be mainly concentrated in Inner Mongolia, Xinjiang, and Henan provinces. At the end of the “Eleventh Five-Year Plan”, Inner Mongolia’s urea production capacity is only 2 million tons, and by the end of the “Twelfth Five-Year Plan”, its new production capacity will reach around 15.5 million tons, or it will become China’s largest urea production base. Since the "Twelfth Five-Year Plan" period, Xinjiang's urea capacity will reach 7.5 million tons, and Xinjiang will become an important growth pole for domestic urea production capacity in the "Twelfth Five-year Plan" period, as the 460,000-ton urea project of Yihua Xinjiang Industrial Park is put into operation. Looking back at Henan Province, Henan Coal Chemical Group, Jinkai Investment, Xinlianxin, Yanhua Huajun, and China Chemical Industry's five giants, according to their respective goals, at the end of the “Twelfth Five-Year Plan”, their urea production capacity will reach 3 million respectively. Tons, 3 million tons, 2 million tons, 1.5 million tons and 1 million tons, plus the Jinhua Tianqing 30 urea project, the new urea production capacity in Henan Province's “Twelfth Five-year Plan” will reach 6.3 million tons.

Second, to complete the qualitative change needs to find the gap, technological innovation to achieve a breakthrough

With the completion and commissioning of a number of large-scale projects, the urea industry has ushered in an increase in volume, but the industry is also soberly aware that to achieve a qualitative leap in the industry, we still have a gap, and we still need to find a breakthrough in the gap.

Yan Xiping, general manager of Yangmei Coal Group, said that compared with world-class companies, domestic companies still have gaps in their ability to independently innovate, lacking basic, original, and critical major scientific and technological achievements, which has restricted the construction of urea projects.

In order to reduce the gap with foreign advanced enterprises as soon as possible, many companies began to make a fuss about scientific and technological innovation. For example, Yangmei Group has set new goals in terms of scientific and technological innovation: vigorously promote mature and advanced technologies such as water-wall coal-water slurry technology and low-pressure hydrolysis gas extraction energy-saving technologies, and rapidly amplify the technological advantages of individual projects into the competitive advantages of the entire industry. Yan Xiping said that the company will also study and explore the coal gasification technology of high ash melting point; Zhengyuan Group will start construction of the Yanzhou Pulverized Coal Pressurized Continuous Gasification Demonstration Project as soon as possible to test the smokeless coal blending technology and strive for direct conversion and utilization. Breakthroughs in the coal resources at the end of the smog; Fengxi Group will use the water-wall coal-water slurry technology that has been successfully tested to transform the traditional atmospheric fixed-bed gasifier, significantly reducing the cost of ammonia production, and establishing a leading edge in the national fertilizer manufacturing industry. .

Learning advanced experience has always been an excellent tradition for nitrogen fertilizer companies. Recently, Shanxi Fengxi Huarui Coal Chemical Co., Ltd. organized a project inspection team and successively went to Henan, Anhui, Jiangsu, and Shanghai to learn from local advanced urea production companies. Xue Xiaobin, head of the company's inspection team and executive deputy in charge of technology, said: “This visit has brought us a great deal of influence. We thought that our own business development was very good. We now feel that our gap is still very large.”

Xue Xiaobin said that when he was visiting in Lingji, Jiangsu, he was looking for a synthesis tower everywhere, but he couldn't find a tall figure that was familiar with it. As a result, when the factory's personnel responsible for the equipment pointed him to him, a humble little device around him was his bitterness. He was very surprised to find the device he was looking for. He was even more shocked when he saw that the nameplate of the equipment was written in 1974.

“I’ve heard earlier that Lingu’s synthetic equipment was repurchased from the United States. At that time, it was very unconvinced, but we saw with our own eyes the production of a synthetic tower in 1974, which produced 450,000 tons of synthetic ammonia, and it’s still us China’s One of the best devices.” Xue Xiaobin said with some excitement. “Knowing that as of now, China’s highest-capacity synthesis tower, which was independently developed by China, was developed by Nanjing Guochang and Shandong Luxi was put into production in 2011. The 300,000-ton device, such as Linggu, has not reached this level in more than 85% of enterprises in China."

In Xue Xiaobin’s view, this is the gap. Someone else’s equipment level in the 1970s and some of us still do not reach it. This is the gap between China’s chemical fertilizers and China’s chemical manufacturing gap. To narrow this gap, in addition to learning advanced experience of others, it is more important to digest and absorb other advanced technologies and finally use it for my own purposes.

Gu Erchang, a well-known domestic chemical expert, pointed out that learning advanced enterprise experience and learning advanced experience of foreign companies has always been a magic weapon for the development and growth of fertilizer companies in China. He said that the construction of large-scale fertilizer installations has broken people’s ideological imprisonment and has actually increased the level of scientific research, design, manufacturing, construction, and factory management in China. Since then, the country has built several large-scale fertilizer plants in Shaanxi, Inner Mongolia, Hainan, Xinjiang, Ningxia, Shanxi, and other provinces, autonomous regions, and autonomous regions. All of them are designed by themselves and most of the equipment is manufactured in China. Many small and medium-sized fertilizer plants have also undergone technological transformation. China's chemical fertilizer industry has entered a new historical period.

"Now, China's urea industry is in an era of profound changes, fully autonomous coal gasification technologies such as space furnaces, Qinghua furnaces, multi-nozzles, multi-component slurry, and synthetic technologies such as Nanjing Guochang 300,000 tons of technology. Technologies such as CNPC Ningxia 45.80 technology are widely used in new construction projects. There are many companies that have introduced and applied the most advanced and new international technologies. These examples are too numerous to mention and they are all good things. Our old comrades see that Afterwards, they were very happy and excited.” Gu Erchang said, “Standing at a new historical starting point, Chinese fertilizer people must have new achievements and breakthroughs!”

Third, excess capacity will still exist, industry concentration or increase

The author comprehensively analyzes the development plans of related companies. After a rough calculation, the domestic new urea production capacity during the “12th Five-Year Plan” period will be about 41.2 million tons, and the total production capacity will reach about 10.72 million tons. If the withdrawal capacity is calculated at 15 million tons, by the end of the “Twelfth Five-Year Plan”, the national urea capacity will reach 90 million tons. The annual domestic consumption is about 55 million tons, plus the annual export volume of 4 million tons, the total demand is about 60 million tons, and the total production capacity is over 30 million tons. The overcapacity situation will continue to exist.

However, many people in the industry have analyzed that the "12th Five-Year Plan" will have an overall increase in industry concentration. Yan Dehong, executive director of Shanxi Dehong Chemical Consultation Co., Ltd., said that if the "12th Five-Year Plan" urea production capacity increased by 41.2 million tons, China's urea production capacity will reach 107.2 million tons. At the same time, according to the requirements of the “Twelfth Five-Year Plan” of China's nitrogen fertilizer industry, the number of urea companies will also be reduced by half, estimated at 95 to 100. According to this calculation, the average production capacity of each enterprise is More than 1.1 million tons, equivalent to the size of each enterprise is two 30.52 projects, so it seems that industry concentration will be unprecedentedly improved.

Yan Dehong also stated that even if the enterprise’s ambitious planning goal is reduced by half, the new production capacity will be 20 million tons. At the end of the “Twelfth Five-Year Plan”, each existing enterprise’s urea capacity will also be between 850,000 and 900,000 tons. between. "So, at present, enterprises with urea production capacity of less than 500,000 tons must be very careful to fully consider their own way out." Yan Dehong said, "According to the current situation, the urea capacity of the 'twelfth five-year' exit is at least 2500. Tens of thousands of tons can be kept in balance. Looking at the goal of reducing the number of companies by half, simply from the perspective of production capacity, enterprises with an output of 200,000 tons or less will be eliminated."

Yang Luyi, a nitrogen fertilizer analyst at China Business Network, stated that from the beginning of 2008 to the end of 2011, there were more than 20 urea companies that had stopped producing more than 100,000 tons (including 100,000 tons) in the country, shutting down a total production capacity of about 3.2 million tons; 27 companies have 6.2 million tons of idle capacity, 81.5% of which have urea production capacity not more than 200,000 tons. Even in the case of high urea prices this year, these days are not too good, "Twelve Five" These companies may be eliminated. Yang Luyi believes that by the end of the “Twelfth Five-Year Plan”, the number of domestic urea companies is expected to reduce to double digits.

“There will be withdrawal when there is entry, which is the law of the industry, especially with the forthcoming introduction of the conditions for access to the synthetic ammonia industry, the withdrawal of urea production capacity has become more and more astounding.” said Zheng Weizhong, Executive Deputy Director of the National Fertilizer Industry General Information Station. During the “Twelfth Five-Year Plan” period, the country must achieve the goal of a balanced supply and demand of nitrogen fertilizer production capacity. This contradicts the rapid growth of production capacity of enterprises. Large companies need new production capacity, and there is no room to do so, which is bound to accelerate the merger of large-scale enterprises. Small companies in exchange for increasing the pace of production capacity, and thus accelerate the withdrawal of small businesses from the urea industry.

"The best way for small urea companies to get out of trouble or avoid elimination is to speed up the transfer." This is the prescription of the Vice President of the China Nitrogen Fertilizer Industry Association and the president of the Shandong Chemical Fertilizer Industry Association, Yang Chunsheng, for small urea companies. He pointed out that small businesses must urgently contact powerful companies to obtain restructuring, obtain strong support in raw materials, capital, technology, and management, quickly eliminate backward production capacity, reduce energy consumption, and reduce costs; To target those short-term, fast-moving and fine chemical products projects with good prospects, high added value, and low investment, accelerate the adjustment of product structure, and actively withdraw from the urea industry.