Domestic melamine industry has encountered new opportunities

The occurrence of the Sanlu milk powder incident in 2009 had a huge impact on the domestic dairy industry, but it played a catalytic role in the development of the melamine industry. Due to the widespread concern of the whole society, people now have a more comprehensive understanding of melamine, and sales of products have become easier. Looking back at 2010, the domestic market trend of melamine has been relatively good. After other chemical products fell significantly after April, the melamine market was basically consolidating at a high level, with a very small drop. After the start of the overall chemical market in July, the melamine market showed a steady upward trend. The high-end price has now surpassed the 10,000 yuan mark to set a new high during the year. In 2010, the melamine factory price was mostly 9400 to 10,000 yuan (t), and the wholesale market price was mostly 9,700 to 10,500 yuan. Compared with the beginning of August, most of the ex-factory price or market wholesale price rose by 500 to 800 yuan, and the high price exceeded 1,000 yuan.

It can be seen from this that the market development of melamine products has been getting better. It is understood that the current good factor for the melamine industry is far more than this, China's melamine industry development coincides with rare opportunities.

The increase in scale and quality has the right to speak in international markets

Since the second half of 2008, affected by the international financial crisis, many small melamine enterprises have been shut down. However, several large-scale melamine units such as Sichuan Yuxiang Melamine Technology Co., Ltd. and Shanxi Fenghe Group have been completed and put into production, and the annual production capacity of melamine in China has remained at 65. More than 10,000 tons. In addition, foreign melamine giants have closed down factories due to the impact of natural gas and urea price increases, which has reduced their share in the international market. After the financial crisis, the proportion of China's melamine production capacity in the world's total production capacity has not only declined, but has increased from 73% in 2007 to more than 85%. More importantly, the average size, technical level, and energy consumption of melamine units in China have been greatly improved due to the elimination of many outdated batch devices with an annual output of less than 3,000 tons. The large-scale melamine enterprises such as Zhonghua Dahua, Chuanhua Group, Shanxi Fenghe, and Sichuan Yuxiang have gained increasing popularity in the world. In particular, Zhongyuan Dahua Group has sold its products to more than 100 countries around the world, and has become an “exempt product” in Europe, the United States, Japan and other countries and regions. The increase of melamine production capacity and the improvement of product quality, equipment scale, and technical level have enabled China's melamine to have more and more pricing discourse in the international market.

Market demand is relatively good

Melamine is mainly used in the building formwork and artificial board industry. In addition, there are also certain amounts of melamine and other industries. At present, these downstream industries have maintained a relatively good state of demand. At the same time, due to the overall improvement in the chemical product market and the increase in raw material urea prices, dealers have a stronger psychological expectation of higher melamine prices, and they have taken stock earlier and increased market demand. In terms of product supply, due to the large number of companies that stopped and overhauled, the output has declined, resulting in a slight shortage of supply in the market and pushing up prices.

Technological progress narrows the gap with international giants

In 2006, the advent of the third-generation gas quenching technology of Beijing Silicon Crystal Technology Co., Ltd. was a milestone for the development of China's melamine industry and ended the long history of relying on imported foreign melamine technology. Through the operation of 20,000 tons and 50,000 tons of devices in Sichuan Yuxiang, it shows that the one-time investment of this technology is only 1/3 of the foreign advanced high-pressure method, and the maintenance costs of raw materials, power, water, electricity, and inspection are all in the world's leading position. Level.

Urea production capacity provides melamine enterprises with adequate and inexpensive raw material protection

According to statistics from the China Nitrogen Fertilizer Industry Association, by the end of 2009, China's urea production capacity will reach 61 million tons, and the output may exceed 58 million tons, while the domestic agricultural demand is only 43 million to 45 million tons, with a surplus of more than 10 million tons.

In order to protect the interests of farmers and maintain domestic chemical fertilizer supply and price stability, the Chinese government has set limits on the export of fertilizer products including urea. Constrained by supply oversupply, domestic urea prices will remain low in 2009, and will allow domestic melamine companies to have cheap and adequate raw material guarantees and improve their products' international competitiveness. After mid-August 2009, raw material urea prices rose sharply due to various factors such as increased export volume, energy conservation and emission reduction checks. In a short span of a week, the ex-factory price of urea generally rose by 50-80 yuan, a high of more than 100 yuan. About 3.2 tons of urea are required for producing 1 ton of melamine. The rise in urea prices has increased the price of melamine.

Export situation is better

Due to the increasing international environmental protection requirements, international melamine production is under pressure. Since the beginning of this year, China's melamine exports have been relatively good. Even starting from July 15, the export tax rebate for melamine has been cancelled, and it has not caused any major impact on exports. This year, China’s melamine monthly export volume has basically remained at a level of 8500 to 11,000 tons, which is relatively stable. From January to July, China exported a total of 69,100 tons of melamine, an increase of 7.62% from 64,200 tons in the same period of last year. At present, the offshore melamine export quotation is mostly 1,360 to 1,390 US dollars, which is basically the same as domestic prices.

In summary, melamine has not been obstructed by dairy products and developed in the face of adversity. The country has set a feasible standard for melamine products: issued a notice on September 16 to further strengthen the quality and safety of dairy products, requiring strict melamine production. Distribution management, melamine distribution from wholesalers to retailers throughout the establishment of real-name registration and other systems to prevent melamine products and waste streams to food production and processing companies and feed production and processing companies.