[Haichuan Chemical Engineering News] Guang’an to Build the World’s Largest Sulfonated Diphenyl Glycine Production Facility with an Annual Output of 500,000 Tons
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The last edit to this post was made by Desert Fish on 2022-4-21 at 18:27. On the morning of April 18, an agreement regarding the high-tech green specialty intermediates project was signed in Chengdu by the People’s Government of Guang’an City in Sichuan Province, Sichuan Hebang Biotechnology Co., Ltd., and the Management Committee of Guang’an Economic Development Zone. The high-tech green specialty intermediate project is the largest industrial project in terms of investment volume to be introduced in Guang’an since it was established as a city. Once completed, it will have an annual production capacity of 500,000 tons of bisphosphonate, with an economic value exceeding 20 billion yuan, making it the world’s largest industrial base for bisphosphonate production. According to the announcement released by Hebang Biology on April 19, the total investment for this project is estimated to be around 12.5 billion yuan, and it is planned to be completed within 24 months from the date when the conditions for commencement of construction are met. Hebang Biology stated that this project will further solidify the company’s position as the world’s largest supplier of bisphosphonates, in line with the company’s high-quality development strategy of \"focus, professionalism, excellence, and strength\", thereby enhancing the company’s core competitiveness and sustainable competitive edge. It is reported that the energy and chemical industry is one of the five pillar industries worth trillions of yuan that Sichuan is focusing on developing, and it is also one of the two industrial clusters worth hundreds of billions of yuan that Guang’an is striving to build. As the first **-level economic development zone in the hinterland surrounding Chongqing, Guang’an Economic Development Zone has developed the Xinqiao Chemical Industrial Park on a scale of 60 square kilometers, using a \"park within a park\" approach. It was designated as the only key industrial zone in the southwest region for the development of pesticide production capacity. It was among the first chemical industrial parks approved in the province and is included in the province’s \"Green Chemical Industry Development Plan\" as a site receiving priority support.
Diglyphosate is an intermediate for glyphosate, which is the herbicide with the largest market share worldwide. In 2021, thanks to the technological advantages of genetically modified crops, these crops were rapidly adopted around the world, driving strong demand for glyphosate and causing its prices to rise steadily. The price of glyphosate (95% technical material) rose from around 28,500 yuan per ton at the beginning of last year to about 80,000 yuan per ton. In April 2022, some suppliers of glyphosate quoted a price of 65,000 yuan per ton, which was at a high level for the past 10 years. Diglyphosate is an intermediate for glyphosate, and its market price trend is generally consistent with that of glyphosate. Regarding the sharp rise in glyphosate prices, HB Bio explained in its 2021 annual report that the cold waves in the United States during the first half of 2021 disrupted operations at glyphosate-producing companies abroad, leading to a growing shortage of glyphosate supply ； In the second half of 2021, under China’s dual-control policies, the prices of the raw materials used in the production of glyphosate kept rising, which further drove up the price of glyphosate itself. Data shows that due to the tightening of environmental protection policies in recent years, outdated glyphosate production capacity has been phased out, resulting in a high level of industry concentration; the CR5 figure for this industry is as high as 71.54%. The current global capacity for glyphosate is approximately 1.143 million tons, of which 773,000 tons are produced domestically and 370,000 tons overseas. According to Hebang Biology, by the end of 2021, the company had a production capacity of 150,000 tons per year for bisphosphonate and 50,000 tons per year for glyphosate. Hebang Biology stated in its annual report that the combined use of glyphosate in various formulations will help to protect the market space for glyphosate, while the expansion of genetically modified crops will become an important driver for growth in demand for glyphosate.
Many companies in the western region planned a multitude of pesticide production projects, but they ended up failing to see them through. The reason wasn’t lack of funds, nor were it issues related to research and development or manufacturing techniques; the real issue was the absence of the necessary capacity and experience to handle projects of such scale. These companies had no idea how to carry out such large-scale projects step by step, and they also had only a superficial understanding of requirements related to standards, safety, environmental protection, and project approval procedures. Many provinces have not allowed the construction of intermediate production facilities on their own for many years. Diphosgene is actually a highly polluting substance, yet this type of project still receives **strong support. What is the reason for this? It is something that those companies responsible for causing pollution and the local authorities should consider carefully. We need not only wealth but also green mountains and clear waters.
The current global glyphosate production capacity is 1.143 million tons, of which 773,000 tons are produced annually in China. After years of consolidation and elimination of production capacity overseas, only Bayer remains, with a glyphosate production capacity of around 370,000 tons per year, accounting for nearly 33% of the global total. However, according to a recent announcement by Bayer, mechanical failures at key raw material suppliers will require about 3 months to restore production, which will undoubtedly disrupt Bayer’s manufacturing processes and lead to a shortage of glyphosate supply. Driven by strong demand during the spring plowing season, glyphosate prices are likely to see another round of increases, allowing glyphosate manufacturers to achieve even higher profits. From 2021 to the present, against the backdrop of recurring pandemics, extreme weather conditions, and volatile geopolitical relations, food security has become a priority for countries around the world. There is strong demand for global commodities in the agricultural sector, leading to rising prices for agricultural products. Benefiting from the technological advantages of genetically modified crops, these crops have seen rapid adoption around the world. The demand for glyphosate, the most widely used herbicide in the world, is strong, which has led to rising prices for this substance.
**Making good use of administrative approval powers is a catalyst for economic development; however, it is also important to take into account issues such as overcapacity and various risks, as well as the environmental impact, safety and reliability of projects, and their stability in future operation. One should not focus solely on immediate benefits. “The term “good” project has two meanings: first, it refers to the quality of the project itself, which requires experts at various levels to conduct evaluations and assessments ； Second is how to build and operate good projects effectively, which requires professionals with extensive experience in various fields. Regarding this project, intermediates of such a large tonnage may pose risks in order to supply foreign companies and domestic enterprises involved. The market is good now; I’ve made huge profits for three years, but what lies ahead in three years is uncertain. Since 2008, glyphosate has been a high-risk product in itself.