A number of
deputies of the National People’s Congress (NPC)
proposed to break the monopoly of state-owned enterprises during the Two
Sessions (NPC and Chinese People's Political Consultative Conference) held in
March 2013. Among them, Tang Yilin, the President of Jinan Shengquan Group Co.,
Ltd. (Shengquan Group), put forward the Suggestion on Accelerating the
Development of the Cellulose Ethanol Industry to Ease Fog and Haze, which
suggested decentralizing the examination and approval authority of fuel
ethanol so that the circulation of the product can get rid of the
control by state-owned enterprises, according to CCM’s monthly report, Corn Products China News issued in March.
Recently, the
serious haze in some northern cities in China such as Beijing has shocked
Chinese people (PICTURE 1). The content of PM2.5 (PM=Particulate Matter) in
Beijing has exceeded 500 μg/m3, hugely threatening residents’ health. Among
all, 22.2% of the PM2.5 was attributed to the exhaust from motor vehicles.
Therefore, the public required Chinese government to raise the quality standard
of gasoline and use more clean energy sources such as fuel ethanol gasoline, a
mixture of fuel ethanol and gasoline with a volume ratio of 1:9. Fuel ethanol
gasoline can reduce the release volumes of carbon monoxide and
carbon dioxide by about 25-30% and 10% respectively.
However, fuel
ethanol is developing slowly in China. At present, there are six fuel ethanol
producers designated by the government (only designated fuel ethanol producers
by the government can produce and sell the product in China) with a capacity of
about 2 million t/a in China. Amongst the six, five are state-owned
enterprises. Although the only enterprise not owned by the government, Shandong
Longlive Bio-technology Co., Ltd., has a 51,500t/a capacity of cellulose
ethanol, 60% share of the company's fuel ethanol project is owned by two
state-owned enterprises.
China has a large
potential to produce dozens of millions of tonnes of fuel ethanol with crop
straw and waste from agriculture and forestry. And some enterprises have
launched production lines in recent two years. But it is quite difficult for
private enterprises to get a designated production certificate of cellulose
fuel ethanol under the policy that “only designated producers can produce
cellulose fuel ethanol and sell the product to appointed enterprises”.
Non-designated fuel ethanol producers cannot enjoy preferential policies or
sell their products as fuel ethanol even though they are able to produce
qualified cellulose fuel ethanol. In Q3 2012, Shengquan Group, one of the top
500 private enterprises in China, put its 20,000t/a cellulose ethanol
production line into operation and applied for a designated production
certificate. But it has not received any reply from the government yet.
Therefore, Mr.
Tang suggested the government modify relevant policies to accelerate the
development of the cellulose ethanol industry in China. On one hand, the
examination and approval authority should be decentralized to provincial or
municipal governments, which can arrange the flow of fuel ethanol according to
local market situations. On the other hand, some unreasonable status quo should
be changed, such as the joint share of state-owned enterprises in the
circulation of the product, giving more decision-making power to fuel ethanol
producers.
Domestic import
volume of DDGS up 41.3% in 2012 over 2011
Chinese corn
products Imp. & Exp. analysis in Jan. 2013
Market price of
furfural increases during Feb.-March 2013
Domestic market
price of edible ethanol decreases in the past five months
Shengtai
Pharmaceutical: gross profit up while net profit down in H2 2012
Baolingbao
approved to issue new non-public stocks
Luzhou Bio-chem
performs poorly in 2012
Fufeng Group
adopts aggressive low-price strategy towards minority amino acids market
Chinese
government may strengthen elimination of backward capacities in 2013
NPC deputies
require more rights for private enterprises in cellulose ethanol industry
2012/2013 outlook
for corn market in China
China continues
to levy anti-dumping duty on potato starch from the EU
Corn Products China News, a monthly publication
issued by CCM on 20th, features “Supply and Demand”, “Import and
Export Analysis”, “Price Update”, “Market & Company Dynamics”, “Policy”, “Corn
Supply” and other more information researched and reported by CCM’s
professional journalists. It is a reliable intermediate for you to know more
about the corn industry in China
CCM is dedicated to market research in
China
Guangzhou CCM Information Science & Technology Co., Ltd.
17th Floor, Huihua Commercial & Trade Mansion, No.80 Xianlie Zhong Road, Guangzhou 510070, China
Tel: 86-20-37616606
Email: econtact@cnchemicals.com
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