“We have sent investment letters to all domestic chlor-alkali enterprises, and we have also published notices on investment promotion in professional magazines, but we did not even receive a consultation call!†said Feng Dianfeng, Deputy Director of Rock Salt Chemical Investment Promotion Bureau of Feicheng Investment Promotion Bureau of Shandong Province. Reluctantly told reporters that, like them, Jiangsu, Huai'an, Jiangxi, and Shaanxi provinces, which have rock salt resources, have encountered similar flaws in the investment promotion of rock salt as the main body for the development of salt chemical industry.
The main raw material of chlor-alkali enterprises is industrial salt, and the production of industrial salt comes from two channels, one is from seawater and the other is underground rock salt. In other words, the downstream products of salt chemical industry are mainly soda ash and caustic soda and many other inorganic salt products derived therefrom.
According to Secretary General Zhao of the Shandong Chlor-Alkali Association, the content of sodium chloride in the brine extracted from seawater is 10%, and the content of sodium chloride extracted from the underground rock salt is very high, averaging above 85%, and industrial salt production using seawater processing. 30% of caustic soda costs 345 yuan per ton of raw materials, and 30% of underground caustic soda produces 305 yuan of caustic soda, and rock salt contains less impurities and does not require concentration. Compared to seawater, the use of underground rock salt to process industrial salt is a raw material cost advantage. Because of this, governments in regions with rock salt resources have focused on the attraction of salt chemical investment. Jiangxi Province also regards it as one of the ten key projects in the “Eleventh Five-Year Plan†in the province, introducing preferential policies and sending special personnel to invite investment. However, from last year to the present, at the place where underground rock salt resources are located, there is no domestic chlor-alkali enterprise to invest in construction, and underground rock salt development remains at the initial stage of raw material extraction and vacuum salt production.
“We thought that we had such a wealth of resources. There would certainly be a lot of chlor-alkali enterprises to invest in and build factories. But investment promotion work has been done for nearly a year now. Why did they not invest in it?†a company from the Feicheng Investment Promotion Bureau of Shandong Province participated in the investment promotion. The staff felt very puzzled.
The reporter also visited some of the two alkali companies with this problem.
Wang Shunping, chief engineer of Zunyi Soda Plant in Guizhou, told reporters that they are reluctant to invest in the location of underground rock salt resources, mainly because of the high electricity prices in those places. He explained that the production of steam and electricity by the two alkalis consumes a lot, and electricity costs account for 60% of the total production cost. Guizhou’s electricity costs 0.4 yuan/kWh, while electricity in Sichuan, where the underground rock salt resources are located, is too tight. The electricity price in Shandong where another resource is located is close to 0.6 yuan/kWh. Only this one, an annual output of 100,000 tons of caustic soda equipment will cost an additional tens of millions of yuan a year.
Huai'an City, Jiangsu Province has 25,2 billion tons of underground rock salt reserves, ranking the first in the world. Nanjing Chemical Industry Co., Ltd., one of China's three major soda ash production companies, has invested 310 million yuan in Lianyungang Soda Plant to build a 4 million cubic meters/year raw brine in Huai'an. The base began trial and supply of halogen at the first station on January 30, 2005. Enterprises can reduce the cost of purchasing salt and alkali for 50 million to 60 million yuan each year. If a company directly constructs a plant in Huai'an, the cost of alkali production will not be lower. When a reporter raises this issue, the director of the plant, Feng Feng, said that this should consider comprehensive investment costs, such as transportation costs. Chlor-alkali industry's product output and raw material transportation ratio is 1:4. Like our 1 million tons/year soda ash company, various raw material transportation volume is 4 million tons. Modern logistics is fast forward and fast out. Lianyungang shipping and land transportation are convenient. In order to build production facilities in special western regions, the cost of transportation will increase by a large amount, and it will not be convenient.
A person in charge of the technical department of Shandong Weifang Yaxing Chemical Co., Ltd. told the reporter that to build a site for the rock salt resource, it is necessary to first purchase the right to mine the resource of the rock in order to develop it. This is not a small expenditure. In addition, supporting facilities such as steam and electricity must be constructed, and they must also face the problem of remote management. Since the rock and salt resources are located in the countryside, any company that invests must establish complete supporting facilities. If the local government builds up supporting facilities and creates stronger advantages to attract companies to invest and develop, it will also become a difficult problem for the location of resources.
According to the reporter's understanding, despite the fierce competition in the national chlor-alkali market, there are still new installations and commissioning operations each year. The production scale of caustic soda in Shandong Province has been expanded from 26 production enterprises in 2000 to 1.28 million tons per year production capacity to 35 manufacturing enterprises in 2005, 3.95 million tons/year, and 39 production companies and 5.05 million tons in the future /year. More than 200,000 tons/year caustic soda production enterprises increased from five in 2000 to six in last year. However, the vast majority of these companies rely on brines from the outside to solve the problem of raw materials.
From this point of view, the fact that rock salt resources are located only by owning resources cannot attract people to invest in development. In other words, many current market factors make China's underground rock salt resources not yet have the advantage of large-scale development.
The main raw material of chlor-alkali enterprises is industrial salt, and the production of industrial salt comes from two channels, one is from seawater and the other is underground rock salt. In other words, the downstream products of salt chemical industry are mainly soda ash and caustic soda and many other inorganic salt products derived therefrom.
According to Secretary General Zhao of the Shandong Chlor-Alkali Association, the content of sodium chloride in the brine extracted from seawater is 10%, and the content of sodium chloride extracted from the underground rock salt is very high, averaging above 85%, and industrial salt production using seawater processing. 30% of caustic soda costs 345 yuan per ton of raw materials, and 30% of underground caustic soda produces 305 yuan of caustic soda, and rock salt contains less impurities and does not require concentration. Compared to seawater, the use of underground rock salt to process industrial salt is a raw material cost advantage. Because of this, governments in regions with rock salt resources have focused on the attraction of salt chemical investment. Jiangxi Province also regards it as one of the ten key projects in the “Eleventh Five-Year Plan†in the province, introducing preferential policies and sending special personnel to invite investment. However, from last year to the present, at the place where underground rock salt resources are located, there is no domestic chlor-alkali enterprise to invest in construction, and underground rock salt development remains at the initial stage of raw material extraction and vacuum salt production.
“We thought that we had such a wealth of resources. There would certainly be a lot of chlor-alkali enterprises to invest in and build factories. But investment promotion work has been done for nearly a year now. Why did they not invest in it?†a company from the Feicheng Investment Promotion Bureau of Shandong Province participated in the investment promotion. The staff felt very puzzled.
The reporter also visited some of the two alkali companies with this problem.
Wang Shunping, chief engineer of Zunyi Soda Plant in Guizhou, told reporters that they are reluctant to invest in the location of underground rock salt resources, mainly because of the high electricity prices in those places. He explained that the production of steam and electricity by the two alkalis consumes a lot, and electricity costs account for 60% of the total production cost. Guizhou’s electricity costs 0.4 yuan/kWh, while electricity in Sichuan, where the underground rock salt resources are located, is too tight. The electricity price in Shandong where another resource is located is close to 0.6 yuan/kWh. Only this one, an annual output of 100,000 tons of caustic soda equipment will cost an additional tens of millions of yuan a year.
Huai'an City, Jiangsu Province has 25,2 billion tons of underground rock salt reserves, ranking the first in the world. Nanjing Chemical Industry Co., Ltd., one of China's three major soda ash production companies, has invested 310 million yuan in Lianyungang Soda Plant to build a 4 million cubic meters/year raw brine in Huai'an. The base began trial and supply of halogen at the first station on January 30, 2005. Enterprises can reduce the cost of purchasing salt and alkali for 50 million to 60 million yuan each year. If a company directly constructs a plant in Huai'an, the cost of alkali production will not be lower. When a reporter raises this issue, the director of the plant, Feng Feng, said that this should consider comprehensive investment costs, such as transportation costs. Chlor-alkali industry's product output and raw material transportation ratio is 1:4. Like our 1 million tons/year soda ash company, various raw material transportation volume is 4 million tons. Modern logistics is fast forward and fast out. Lianyungang shipping and land transportation are convenient. In order to build production facilities in special western regions, the cost of transportation will increase by a large amount, and it will not be convenient.
A person in charge of the technical department of Shandong Weifang Yaxing Chemical Co., Ltd. told the reporter that to build a site for the rock salt resource, it is necessary to first purchase the right to mine the resource of the rock in order to develop it. This is not a small expenditure. In addition, supporting facilities such as steam and electricity must be constructed, and they must also face the problem of remote management. Since the rock and salt resources are located in the countryside, any company that invests must establish complete supporting facilities. If the local government builds up supporting facilities and creates stronger advantages to attract companies to invest and develop, it will also become a difficult problem for the location of resources.
According to the reporter's understanding, despite the fierce competition in the national chlor-alkali market, there are still new installations and commissioning operations each year. The production scale of caustic soda in Shandong Province has been expanded from 26 production enterprises in 2000 to 1.28 million tons per year production capacity to 35 manufacturing enterprises in 2005, 3.95 million tons/year, and 39 production companies and 5.05 million tons in the future /year. More than 200,000 tons/year caustic soda production enterprises increased from five in 2000 to six in last year. However, the vast majority of these companies rely on brines from the outside to solve the problem of raw materials.
From this point of view, the fact that rock salt resources are located only by owning resources cannot attract people to invest in development. In other words, many current market factors make China's underground rock salt resources not yet have the advantage of large-scale development.
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