China Food Grade Phosphate Market Status Analysis

outline: China's phosphate industry after years of strategic layout and product structure adjustment, has gradually formed primary products (yellow phosphorus and phosphoric acid) near the origin of raw materials - coastal areas focusing on the development of phosphorus derivatives and fine phosphorus chemical products of a reasonable layout. 94% of China's yellow phosphorus production capacity has been concentrated in Yunnan, Guizhou, Sichuan, Hubei and other energy-rich, lower energy prices in the region, to ensure that China's low-cost yellow phosphorus, thus strongly support China's huge phosphate industry.

      I. Status of the phosphate market

　　(A) phosphate

　　China's phosphate industry after years of strategic layout and product structure adjustment, has gradually formed primary products (yellow phosphorus and phosphoric acid) near the origin of raw materials - coastal areas focusing on the development of phosphorus derivatives and fine phosphorus chemical products of a reasonable layout. 94% of China's yellow phosphorus production capacity has been concentrated in Yunnan, Guizhou, Sichuan, Hubei and other energy-rich, lower energy prices in the region, to ensure that China's low-cost yellow phosphorus, thus strongly support China's huge phosphate industry.

　　At present, China has become one of the world's largest production capacity of phosphate country, has established to mine to the production of basic raw materials, and then to a variety of commonly used inorganic phosphate production of a complete industrial system. The production of fine phosphate products, the production of organic phosphorus products have also made great strides in development and technological progress. China's phosphate products can basically meet the domestic needs, and exports, phosphate production of basic products and backbone varieties such as yellow phosphorus, industrial phosphoric acid, industrial-grade and food-grade sodium tripolyphosphate, feed-grade calcium phosphate, industrial-grade sodium phosphate and other products in the world trade, China has been occupying the first two. China's phosphate products also have a pivotal position in world trade, both in terms of product quality and cost have obvious advantages.

　　In recent years, under the stimulation of foreign investors, there is a trend of blind expansion of phosphate enterprises in China. For example, Yunnan South Phosphorus Group pre 50,000 tons of industrial sodium tripolyphosphate put into production, Sichuan Tianyuan Co., Ltd. is also in the current 40,000 tons of scale on the basis of the production capacity of sodium tripolyphosphate has been expanded to 200,000 tons, Chongqing Chuandong Chemical Industry Group is also intended to expand production capacity, and most of the eastern enterprises have also implemented the expansion of production capacity. In the large-scale expansion of enterprise capacity at the same time, the domestic market demand is not synchronized expansion. The remaining products only seek foreign markets. 2006, China's main phosphate products in phosphoric acid exports

　　580,000 tons, an increase of 25% over the same period in 2005; sodium tripolyphosphate exports about 500,000 tons, an increase of 12% over the same period last year.

　　Phosphate industry cyclical characteristics of the more obvious, China's phosphate industry overall overcapacity, especially to the industrial level as the main primary products is an imbalance between supply and demand, competition is inevitable. The current phosphate export situation is less happy and more worried, because the industry uses the main raw material yellow phosphorus is of strategic importance. With the continuous transformation of the domestic phosphate industry structure, the future development of phosphate enterprises will gradually shift to high value-added.

　　(B) food-grade phosphates

　　Food-grade phosphates are mainly used as nutritional enhancers and quality improvers in function, and the types of edible phosphates generally include sodium phosphate, potassium phosphate and calcium phosphate, which are widely used in dairy processing, food preservation, brewing and fermentation, and other food industry and beverage industry. The largest market for sodium phosphate is meat, poultry and seafood, with sodium tripolyphosphate as the main product. The second largest market is bakery products, where sodium phosphate is used as a bulking agent in frozen and chilled doughs, frozen pre-baked pastries, premixes and yeast products. Sodium acid pyrophosphate and sodium aluminum phosphate are the two major sodium phosphate products in this market. Sodium phosphate is also used in dairy and related products.

　　Global market demand for food phosphates is about 500 million U.S. dollars or so, and with an annual rate of 2% increase; in recent years, China's phosphate food additives research and development is more active, in 2002, the national production of food phosphate production capacity of 50,000 tons/year, the actual annual output of about 30,000 tons/year, the use of food phosphates have 11 varieties, compared with the developed countries there is a large gap. It can be seen that the domestic development of food-grade phosphate has a broad market potential.

　　By 2008, the domestic and foreign macroeconomic environment changes, the phosphorus chemical industry in also experienced ups and downs. 2008 1-9 months in the phosphorus chemical industry in the context of high prosperity, phosphate rock and phosphorus chemical products prices rose sharply in September, with the spread of the international financial crisis, the phosphorus chemical industry boom degree of rapid downward movement of domestic and foreign demand for phosphorus chemical products declined rapidly by the contraction of exports and the domestic Influenced by the shrinking of exports and sluggish domestic demand, the recent phosphate enterprises are generally in the doldrums.

　　At present, Yunnan, Guizhou, Hubei and other major domestic phosphate producers of enterprise start rate is generally not high, mainly due to the domestic and foreign two market demand downturn, overcapacity is the root cause. Phosphorus resource scarcity makes the relevant enterprises can not bear to give up this piece of "cake", coupled with the industry's profitability continues to improve, hindering the industry's pace of eliminating backward production capacity, wait-and-see and the psychology of fluke around many enterprises. Potential production capacity will be released at any time, so the current market is caused by this unheated and awkward situation.

　　With the phosphoric acid