Wednesday, December 28, 2011

Increasing Electricity Price Pressures Yellow Phosphorus Industry

The December issue of Phosphorus Industry China Monthly Report has been published by CCM International on December 15th , 2011. The top story is that yellow phosphorus industry is going to be hit by the increasing electricity price.

The electricity price in China has been increased in different degrees in different regions since December 1st , 2011. The average price of electricity will rise by 0.47p/kWh nationwide, up 6.8% compared with that in 2010. For yellow phosphorus producers, it means the cost of production is to rise by USD66.14/t at least.

What’s worse, electricity prices in Guizhou Province and Yunnan Province are estimated to rise by 0.79p/kWh and 2p/kWh respectively during the dry season (Dec., Jan.–Apr.) each year, both with more than 10% increase compared with other seasons. That is to say, the four major yellow phosphorus production provinces (Hubei, Yunnan, Sichuan, Guizhou) will experience the pressure of increasing electricity price in different degrees.

In addition, most downstream purchasers, such as producers of phosphoric acid, STPP and POCl3, have also felt the great pressure caused by the current yellow phosphorus price and the poor sales performance. It seems hard for them to transfer the increased cost to depressed downstream industry in the short term.

It is believed that the increasing electricity price will give pressure to domestic yellow phosphorus industry. This dry season will be a tough period for most yellow phosphorus enterprises, as well as downstream purchasers of yellow phosphorus.

Headline News of Phosphorus Industry China Monthly Report 1112:
-Thanks to the technology advantage on recycling phosphorus resource, Wengfu Group successfully absorbs investment overseas.
-Major policies in 2011 promote the sustainable development of phosphorus industry.
-More and more recycling projects regarding yellow phosphorus waste emerge in China.
-Yellow phosphorus industry is going to be hit by the increasing electricity price.
-Phosphate fertilizer industry in Hubei Province is to be integrated in the light of the latest issued proposal.
-Winter storage of phosphate fertilizer is not optimistic this year in China.
-Sales of single superphosphate are suffering pressures.
-Liuguo Chemical horizontally merges with Guixi Fertilizer to strengthen its scope effect.
-Hubei Xingfa and Wengfu Group commence cooperation on developing downstream deep processing fine phosphorus products.
-The industrial application of purification technology of wet-process phosphoric acid is emerging in China.
-The average export price of phosphorus products is soaring in Oct. 2011.
-Increase in electricity price pushes up the price of yellow phosphorus, while those of other phosphorus keep stable in general.

Phosphorus Industry China Monthly Report, a monthly publication issued by CCM International on 15th of every month, provides you the latest information on company dynamic, industry dynamic, factors impacting the price fluctuation, technology improvement, supply & demand of China's phosphorus industry.

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