At present, the production costs and selling prices of the potassium sulphate industry are upside down, some companies in the industry have stopped production or reduced production, and the excess production capacity of the industry has become a fact. The potassium sulphate industry has already experienced a chill. If the future large industrial companies plan production capacity and raw material prices continue to rise, the potassium sulphate industry will enter a cold winter.
At present, the production costs and selling prices of the potassium sulphate industry are upside down, some companies in the industry have stopped production or reduced production, and the excess production capacity of the industry has become a fact. The potassium sulphate industry has already experienced a chill. If the future large-scale industrial enterprises plan production capacity and raw material prices continue to rise, the potassium sulphate industry will completely enter the icy winter.
The prices have been hanging upside down This year, the price of potassium chloride, the main raw material for the production of potassium sulfate, has continued to rise, and the price of potassium sulfate has stagnated. As a result, the production costs and product prices are upside down, causing the entire industry to fall into the quagmire of losses.
Zhang Yumei, general manager of Shaanxi Jingsheng Sulfate Potash Fertilizer Co., Ltd., said: “Now we produce potassium sulphate at a loss. The price of potassium sulphate to retail investors is 2,250 yuan per ton, and the large customer is 2,200 yuan per ton, while the actual production cost of potassium sulphate is about For a price of 2,500 yuan per ton, a loss of about 300 yuan will be incurred for every ton produced."
Yu Liangming, general manager of Shandong Liaocheng Santai Chemical Co., Ltd., said: “At present, not only the price of potassium chloride has continued to rise, but also the price of sulfuric acid, a raw material of potassium sulfate, has risen due to the increase in the price of sulfur.â€
Zhao Zhaoying, director of the Information Center of the Potash Branch of the China Inorganic Salt Industry Association, said: “Since the Spring Festival this year, the price of potassium chloride has been rising all the way. At the beginning of this year, it was RMB 1,640 per ton. The current factory price has gone up to RMB 2,200 per ton, which is a big increase. , And the price of potassium chloride is still rising. Currently, the market price of potassium sulfate is upside down, and the industry as a whole is losing money."
Faced with the predicament, some manufacturers chose to stop production or reduce production, but more companies chose to persist.
Zhang Yumei said: “Last year when the price of potassium chloride was relatively cheap, we purchased more, and now we can support stock production for a certain period of time. However, if the price of potassium sulfate is still not rising, we can only stop production or reduce production. Now, there are already many The company stopped production or cut production."
In fact, for businesses, the determination to stop production is also not good.
Zhai Zhaoying said: “The current situation has caused various companies to suffer. It is to give up the hard-won markets for a few years, or choose painful persistence, and hope that the future can have a good harvest. Now many companies are using the market a few years ago. The foundation bite teeth maintained during the boom period are hoping to get out of trouble and spring up."
If the production cost is inversely related to the sales price, the potassium sulphate industry has experienced cold weather, and the sale of the byproduct of the sale of potassium sulphate as a byproduct of hydrochloric acid has made many producers of potassium sulphate worse and the production and operation have become extremely difficult.
Zhai Zhaoying said: "Since hydrochloric acid is not suitable for transportation, the price varies from place to place. For example, the price of hydrochloric acid in Shanghai is 300 yuan per ton, while in Shandong, it is only 50 yuan per ton. Businesses that sell without bidding are very difficult to manage."
The raw materials are causing disasters. In the end, what causes most of the potassium sulfate companies to be in crisis?
Yu Liang believes that the current root cause of the plunge in the potassium sulphate industry is rising raw material prices. China's lack of potassium chloride resources, the current raw materials used in the production of potassium sulfate basically comes from abroad. In recent years, a few countries such as Canada, Russia, Jordan, Israel, etc., have monopolized the operation of a large number of potassium chloride-rich resources, resulting in the continuous rise in the price of raw material potassium chloride, which has caused the cost of China's potassium sulfate production companies to rise continuously.
Zhai Zhaoying said: “Since domestic companies generally use Mannheim furnaces for production, their requirements for raw material grades are relatively high, and China’s potassium chloride resources are tight and its grades are not enough. It is only imported from overseas and the supply of resources is controlled by people. The companies have no say in the pricing of resources, which has led to a rise in the prices of domestic raw materials, which have greatly exceeded the increase in potassium sulfate prices, making the potassium sulfate industry collectively loss-making."
In addition to the factors of rising raw material prices, changes in supply and demand are also a major cause of the plight of the potassium sulphate industry.
It is understood that before 1998, potassium sulfate in China basically relied on imports. In 1998, the localization of potassium sulphate process started with Qingshang Group started. From 1998 to 2005, due to the considerable price difference between the raw material potassium chloride and potassium sulfate, some companies have obtained a lot of profits from this, and the domestic potassium sulphate industry has developed rapidly.
Zhao Zhaoying said: "So far, China's potassium sulfate producers have reached more than 50, with an installed capacity of 2.08 million tons. In 2006, the output was 1.3 million tons, and the total demand for potassium sulfate in China was only 1 million tons. Oversupply has become an indisputable fact."
When most of the potassium sulphate production companies are struggling, very few large-scale potassium sulphate companies with resource advantages have a much better day. For example, SDIC's Xinjiang Lop Nur Potash Co., Ltd. relies on the abundant resources of Lop Nor, and the production cost per ton of potassium sulphate is controlled at about 1,000 yuan. According to the current market price of potassium sulphate, the profit is still abundant.
According to Zhang Yumei, “Lop Nur Potash Company only has to pay the cost of transportation because there is no pressure from raw materials, so the production cost is far lower than that of the general production enterprises. The selling price of the product is 50-70 yuan less per ton, which lowers the potassium sulfate. The market price has seriously affected the enterprises that need to purchase raw materials for production."
Yu Liangliang said: “The current annual production scale of Lop Nur Potash Company is 110,000 tons, and the annual production capacity will reach 1.2 million tons by 2010, and the current market supply of potassium sulphate is already saturated. By 2010, the company's production capacity will reach production, The competition in the domestic market will become more intense and prices may drop. Other domestic producers of potassium sulfate are very concerned about this."
Want to cancel the VAT "before returning"
In order to ease the current crisis, the China Salt Division of the inorganic salt industry solicited opinions from various companies and intended to report to the Ministry of Finance and the State Administration of Taxation about the operational difficulties of the potassium sulphate industry. It is proposed to abolish the current VAT return policy and restore the original The "production and sales of potassium sulfate fertilizer enterprises exempted from value-added tax" policy to reduce the pressure on production companies.
Yu Liangliang said: "After the VAT repatriation, we must pay a tax of 10 million yuan each year for companies with an annual production scale of 40,000 tons. Although it will eventually be returned to the company, it will take a long time to make the company fund. The circulation period was extended.†During the interview, the reporter found that many companies have such problems.
Zhai Zhaoying said: "The current policy of returning value-added goods first is implemented from December 2004. The implementation of this policy varies from place to place. Some big cities are more formal, and some small cities are on implementation. There are unsatisfactory places, for example, some places have not returned VAT for more than a year, and even the phenomenon of non-return of value-added tax has existed, and some companies have accumulated more than 10 million yuan in taxes, which has greatly increased the production costs of enterprises. It is hoped that the state will cancel the policy of returning the value-added tax first, reduce the production cost of the enterprise, and help the company tide over the difficulties."
In addition, the China Potash Branch of the Inorganic Salt Industry Association also intends to focus on the development of overseas markets by some companies to resolve the domestic oversupply conflict.
Zhai Zhaoying said: "The association will also guide enterprises to strengthen energy-saving and emission reduction work, and use some other good technologies and methods in other industries to control costs."
At the same time, the China Potash Branch of the Inorganic Salt Industry Association also called on domestic companies to strictly abide by the industry self-discipline convention and avoid vicious price competition in the potassium sulphate industry.
At present, the production costs and selling prices of the potassium sulphate industry are upside down, some companies in the industry have stopped production or reduced production, and the excess production capacity of the industry has become a fact. The potassium sulphate industry has already experienced a chill. If the future large-scale industrial enterprises plan production capacity and raw material prices continue to rise, the potassium sulphate industry will completely enter the icy winter.
The prices have been hanging upside down This year, the price of potassium chloride, the main raw material for the production of potassium sulfate, has continued to rise, and the price of potassium sulfate has stagnated. As a result, the production costs and product prices are upside down, causing the entire industry to fall into the quagmire of losses.
Zhang Yumei, general manager of Shaanxi Jingsheng Sulfate Potash Fertilizer Co., Ltd., said: “Now we produce potassium sulphate at a loss. The price of potassium sulphate to retail investors is 2,250 yuan per ton, and the large customer is 2,200 yuan per ton, while the actual production cost of potassium sulphate is about For a price of 2,500 yuan per ton, a loss of about 300 yuan will be incurred for every ton produced."
Yu Liangming, general manager of Shandong Liaocheng Santai Chemical Co., Ltd., said: “At present, not only the price of potassium chloride has continued to rise, but also the price of sulfuric acid, a raw material of potassium sulfate, has risen due to the increase in the price of sulfur.â€
Zhao Zhaoying, director of the Information Center of the Potash Branch of the China Inorganic Salt Industry Association, said: “Since the Spring Festival this year, the price of potassium chloride has been rising all the way. At the beginning of this year, it was RMB 1,640 per ton. The current factory price has gone up to RMB 2,200 per ton, which is a big increase. , And the price of potassium chloride is still rising. Currently, the market price of potassium sulfate is upside down, and the industry as a whole is losing money."
Faced with the predicament, some manufacturers chose to stop production or reduce production, but more companies chose to persist.
Zhang Yumei said: “Last year when the price of potassium chloride was relatively cheap, we purchased more, and now we can support stock production for a certain period of time. However, if the price of potassium sulfate is still not rising, we can only stop production or reduce production. Now, there are already many The company stopped production or cut production."
In fact, for businesses, the determination to stop production is also not good.
Zhai Zhaoying said: “The current situation has caused various companies to suffer. It is to give up the hard-won markets for a few years, or choose painful persistence, and hope that the future can have a good harvest. Now many companies are using the market a few years ago. The foundation bite teeth maintained during the boom period are hoping to get out of trouble and spring up."
If the production cost is inversely related to the sales price, the potassium sulphate industry has experienced cold weather, and the sale of the byproduct of the sale of potassium sulphate as a byproduct of hydrochloric acid has made many producers of potassium sulphate worse and the production and operation have become extremely difficult.
Zhai Zhaoying said: "Since hydrochloric acid is not suitable for transportation, the price varies from place to place. For example, the price of hydrochloric acid in Shanghai is 300 yuan per ton, while in Shandong, it is only 50 yuan per ton. Businesses that sell without bidding are very difficult to manage."
The raw materials are causing disasters. In the end, what causes most of the potassium sulfate companies to be in crisis?
Yu Liang believes that the current root cause of the plunge in the potassium sulphate industry is rising raw material prices. China's lack of potassium chloride resources, the current raw materials used in the production of potassium sulfate basically comes from abroad. In recent years, a few countries such as Canada, Russia, Jordan, Israel, etc., have monopolized the operation of a large number of potassium chloride-rich resources, resulting in the continuous rise in the price of raw material potassium chloride, which has caused the cost of China's potassium sulfate production companies to rise continuously.
Zhai Zhaoying said: “Since domestic companies generally use Mannheim furnaces for production, their requirements for raw material grades are relatively high, and China’s potassium chloride resources are tight and its grades are not enough. It is only imported from overseas and the supply of resources is controlled by people. The companies have no say in the pricing of resources, which has led to a rise in the prices of domestic raw materials, which have greatly exceeded the increase in potassium sulfate prices, making the potassium sulfate industry collectively loss-making."
In addition to the factors of rising raw material prices, changes in supply and demand are also a major cause of the plight of the potassium sulphate industry.
It is understood that before 1998, potassium sulfate in China basically relied on imports. In 1998, the localization of potassium sulphate process started with Qingshang Group started. From 1998 to 2005, due to the considerable price difference between the raw material potassium chloride and potassium sulfate, some companies have obtained a lot of profits from this, and the domestic potassium sulphate industry has developed rapidly.
Zhao Zhaoying said: "So far, China's potassium sulfate producers have reached more than 50, with an installed capacity of 2.08 million tons. In 2006, the output was 1.3 million tons, and the total demand for potassium sulfate in China was only 1 million tons. Oversupply has become an indisputable fact."
When most of the potassium sulphate production companies are struggling, very few large-scale potassium sulphate companies with resource advantages have a much better day. For example, SDIC's Xinjiang Lop Nur Potash Co., Ltd. relies on the abundant resources of Lop Nor, and the production cost per ton of potassium sulphate is controlled at about 1,000 yuan. According to the current market price of potassium sulphate, the profit is still abundant.
According to Zhang Yumei, “Lop Nur Potash Company only has to pay the cost of transportation because there is no pressure from raw materials, so the production cost is far lower than that of the general production enterprises. The selling price of the product is 50-70 yuan less per ton, which lowers the potassium sulfate. The market price has seriously affected the enterprises that need to purchase raw materials for production."
Yu Liangliang said: “The current annual production scale of Lop Nur Potash Company is 110,000 tons, and the annual production capacity will reach 1.2 million tons by 2010, and the current market supply of potassium sulphate is already saturated. By 2010, the company's production capacity will reach production, The competition in the domestic market will become more intense and prices may drop. Other domestic producers of potassium sulfate are very concerned about this."
Want to cancel the VAT "before returning"
In order to ease the current crisis, the China Salt Division of the inorganic salt industry solicited opinions from various companies and intended to report to the Ministry of Finance and the State Administration of Taxation about the operational difficulties of the potassium sulphate industry. It is proposed to abolish the current VAT return policy and restore the original The "production and sales of potassium sulfate fertilizer enterprises exempted from value-added tax" policy to reduce the pressure on production companies.
Yu Liangliang said: "After the VAT repatriation, we must pay a tax of 10 million yuan each year for companies with an annual production scale of 40,000 tons. Although it will eventually be returned to the company, it will take a long time to make the company fund. The circulation period was extended.†During the interview, the reporter found that many companies have such problems.
Zhai Zhaoying said: "The current policy of returning value-added goods first is implemented from December 2004. The implementation of this policy varies from place to place. Some big cities are more formal, and some small cities are on implementation. There are unsatisfactory places, for example, some places have not returned VAT for more than a year, and even the phenomenon of non-return of value-added tax has existed, and some companies have accumulated more than 10 million yuan in taxes, which has greatly increased the production costs of enterprises. It is hoped that the state will cancel the policy of returning the value-added tax first, reduce the production cost of the enterprise, and help the company tide over the difficulties."
In addition, the China Potash Branch of the Inorganic Salt Industry Association also intends to focus on the development of overseas markets by some companies to resolve the domestic oversupply conflict.
Zhai Zhaoying said: "The association will also guide enterprises to strengthen energy-saving and emission reduction work, and use some other good technologies and methods in other industries to control costs."
At the same time, the China Potash Branch of the Inorganic Salt Industry Association also called on domestic companies to strictly abide by the industry self-discipline convention and avoid vicious price competition in the potassium sulphate industry.
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