Beginner: Seeking corrections for errors; A research report on the development of the wet-process phosphate technology in the fine phosphorus chemicals industry

Thread Content

Market Research Report on the Development of the Wet Phosphoric Acid Process in the Fine Phosphorus Chemicals Industry. At present, over 85% of the wet-process purified phosphoric acid in China is used in the production of phosphorus-based fertilizers; only a small amount is used as finished acid. For a long time, China has relied on heat-process phosphoric acid to meet the quality requirements for fine phosphorus chemical products. Affected by **policies, resources, the environment, costs, and the development of wet-process phosphoric acid purification technologies, the market for thermal phosphoric acid and the fine phosphorus chemicals industry driven by thermal phosphoric acid will gradually be eroded by wet-process phosphoric acid, which represents the direction of development in modern phosphorus chemistry. Currently, in China, only a few companies use the wet phosphoric acid process to produce high-quality phosphorus chemical products, such as Chongqing Fuling Chemical, Guizhou Wengfu Group, and Anhui Liuguo Chemical. With the fierce competition in the domestic phosphate fertilizer market and the development of China’s economy, various industries are demanding rapid growth in the fine phosphate chemicals sector; as a result, more and more enterprises using the wet phosphoric acid process will join this industry. Among them, Wengfu Group is at the forefront of advanced phosphorus chemical manufacturing; in 2010, it was the first to successfully commission a 1,000-ton/year electronic-grade phosphoric acid production facility using the crystallization method. Shikefeng Sichuan Leibo Chemical Co., Ltd. owns phosphate mines in the upstream sector, is located near the future main sulfur production area in Asia (Dazhou, Sichuan), and has synthetic ammonia production projects under development; as a result, it enjoys one of the lowest cost advantages among many phosphate chemical enterprises in China. At present, our company is still focused on producing low-grade phosphate fertilizer products. Although this gives us a cost advantage, the increasing competition in the domestic market, changes in demand in international markets, and alterations in tariff policies mean that producing products with low added value, which currently dominate our production, is clearly not in line with the group’s strategic goals for development. In terms of the domestic market situation, where thermal phosphoric acid products still dominate the market while wet-process phosphoric acid products are still in their initial stages of development, our company should also seize this favorable opportunity. We should focus on deep processing and higher levels of refinement when planning future projects and attracting talent, in order to capture a share of the market for high-quality phosphorus chemical products. Our company’s field of fine phosphorus chemicals is still in its infancy. The development of such chemicals should not be carried out blindly; it is necessary to take into account specific circumstances. In pursuing the development of fine phosphorus chemicals, we should start with industrial-grade products, strive to achieve dominance in the food-grade segment, develop products for electronic use, and implement a strategy similar to a dumbbell approach. As an axis connecting the low-end and high-end categories, food grade focuses on the industrial and electronic grades at both ends. I believe the company should start with the first-phase project, carrying out further processing of products based on existing projects and processes. For example, by developing (industrial) monoammonium phosphate through drip irrigation without affecting the production of 150,000 tons of ammonium phosphate, it is possible to produce high-quality drip irrigation fertilizers, which can also serve as a raw material for ammonium phosphate dry powder fire extinguishers. Currently, companies such as Zhongxiang Chemical in Hubei, Wuhan Nanqing, and Sichuan Longmang Group produce this product. It is reported that producing 200,000 tons of monoammonium phosphate allows for the extraction of 40,000 tons of monoammonium phosphate for drip irrigation (industrial use). The profit margin on this product is currently around 1,000 yuan per ton; with an annual production volume of 40,000 tons, the annual profit can reach 40 million yuan. The investment required for this production process is approximately 20 million yuan. Industrial-grade phosphoric acid is widely used in metal surface treatment agents, phosphate-based product manufacturing, organic reaction catalysts, refractory material additives, and activated carbon treatment agents. The industrial-grade phosphoric acid produced by Chongqing Fuling Chemical using the wet phosphoric acid purification technology currently has a market price of 5,000–5,100 yuan per ton; the annual production volume is around 40,000–50,000 tons. This product is mainly supplied to the domestic market, and sales are currently performing well. Guizhou Wengfu Group produces around 80,000 tons of industrial-grade phosphoric acid per year, with a factory price of 4,500 yuan per ton. The domestic food industry is growing at a rapid pace of over 10% per year, while the global market for edible phosphates is expanding at a rate of 2% per year. Food-grade phosphoric acid, as the main raw material for various food-grade phosphates, has very promising market prospects in the future. In line with the development plan for China’s food industry, by 2015 the proportion of grain processed into industrial foods is expected to rise from the current 15% to 58%, with the processing volume reaching 120 million tons. Based on the above plan, it is estimated that by 2015, China’s demand for food-grade phosphates will exceed 210,000 tons. Currently, the global demand for food-grade phosphates exceeds 1.5 million tons. There is a significant gap between the production and consumption of food-grade phosphates in China and abroad. There are too many production units in China, but they mostly produce in small quantities and offer a limited range of products; (while the world has 17 categories and nearly 100 varieties of phosphates used in food production, China only produces around 20 such varieties). The quality of these products is low, and there is no scale-based or standardized production system similar to that in other countries ； In our country, food-grade phosphates are used in only a limited range of industries within the national economy, whereas abroad they are employed in a wide variety of applications. This year, the domestic food-grade phosphate market has remained stable, primarily due to **export policies and the rapidly growing domestic demand. In January 2011, China exported a total of 42,863,599 kilograms of food-grade phosphoric acid, with an export value of $31,047,906. Compared to the same month the previous year, exports increased by 25.10% in volume and by 39.62% in value. As the largest domestic manufacturer of food-grade phosphoric acid using the wet-process phosphoric acid technique, Guizhou Wengfu Group currently produces around 80,000 tons per year, with a factory price of 4,600 yuan per ton. Electronic-grade phosphoric acid requires a high level of technical expertise; its price is less affected by the cost of raw materials and depends more on supply and demand dynamics. China’s market for electronic-grade phosphoric acid is largely met through imports, and the rapidly developing electronics industry provides a broad market for such phosphoric acid. As a key component in the field of fine phosphorus chemicals, electronic-grade phosphoric acid is of great importance. Our company’s leadership must think ahead, take proactive measures, seize this strategic advantage, and master the core technologies in order to secure a strong position in the fine phosphorus chemicals industry and ultimately succeed in market competition. On March 28, 2011, as soon as I arrived at the company, I was asked to write a report on this topic. There are many mistakes in it; I hope those with more experience can provide their feedback and help me improve it.