The development of fluorine chemicals in China has entered the Chaoyang period and the market is expanding

Rich fluorite resources, a good investment environment, a vast market, and relatively low manufacturing costs are attracting international fluorine chemical companies into China. With the continuous rise in international crude oil prices, the original high-cost fluorine products began to show a better price/performance ratio. The market’s demand for fluorine products has increased significantly, and the Clean Development Mechanism (CDM) emission reduction transaction will bring huge profits to fluorine production companies. China's fluorine chemical industry is entering the Chaoyang period, and the market space is expanding.
Fluorine Chemical Industry in China The fluorine chemical products are widely used in the fields of military, chemical, machinery and other fields for their excellent performances such as chemical resistance, high and low temperature resistance, aging resistance, low friction, and insulation, and have become the fastest growing in the chemical industry. One of the most high-tech and most promising industries. For decades, the global fluorine chemical industry has developed steadily, and new fields of application continue to expand. For a long time, the production capacity and consumption demand of global fluorine-containing polymer materials have increased at a rapid pace. Among them, Asia, especially China, has developed rapidly. In recent years, global consumption growth rate has been around 4%, while China’s annual growth rate has exceeded 15%. . China and the United States, Japan, and the European Union have formed the world's four major fluorine product production and consumption areas.
After more than 50 years of development, the production technology of the fluorine chemical industry in China has matured, the scale of the equipment has been continuously expanded, product grades have gradually increased, and products can basically meet domestic demand. Some products can participate in the competition in the international market. At present, basic raw materials such as HF, AlF3, F22, and TFE monomers have been formed, and the elimination of perchlorofluorocarbons (CFCs) has been implemented earlier than originally planned. The development of ODS substitutes has formed a series, with aromatic fluoride as the main component. The fluorine-containing intermediates have made great progress, and the three waste treatment technologies have made great progress, and major breakthroughs have been made in research in some areas. In the past 10 years, China has formed a number of key enterprises in the production of fluorine materials such as Zhejiang Juhua Co., Ltd. and Shanghai San Aifu, and thousands of small and medium-sized enterprises. The annual sales of fluorine products is approximately RMB 15.5 billion. At present, our country's existing production capabilities include: anhydrous hydrogen fluoride 800,000 tons/year, TFE 74,000 tons/year, PTFE 33,000 tons/year, fusible fluororesin 2900 tons/year, fluorine rubber 3,000 tons/year . According to Yang Xiaoyong, chief engineer of China Blue Chenguang Research Institute of Chemical Industry, China has included the fluorochemical industry as a leading and strategic industry with major driving roles, and has included it in the scope of high-tech industries that the country has been encouraging to develop.
The energy crisis and rising oil prices provide opportunities for the fluorine chemical industry. The fluorine industry does not use petroleum and natural gas as the main raw material, and its correlation with oil prices is modest. However, analysts believe that global energy is increasingly strained, but it is fluorosilicon materials. Development provides a huge space. Fluorine products are new materials for high-performance chemicals, and their production technologies are complex. The overall price is higher than that of oil and natural gas. With the increase in the price of petroleum products, the price gap between the two is gradually narrowing, which provides a broad space for fluorine materials to expand their application market.
At present, the total global fluoropolymer production capacity is approximately 220,000 tons/year, and China's production capacity is approximately 40,000 tons/year, accounting for 18% of the world's total production capacity. It has become the world's second largest fluoropolymer producer. Ye Zhixiang, chairman of Zhejiang Juhua Group, believes that with the strengthening of economic strength and the improvement of people's living standards, China's demand for fluorine products will grow faster than the global average. In the next 10 years, the global demand for fluoropolymers will still maintain the same growth rate, and the average global demand for fluorine products will increase by more than 3%. It is expected that during the 11th five-year plan period, China's fluoropolymer production capacity will maintain an annual growth rate of 15%. In 2010, the production capacity will reach 70,000 tons/year, and the total output will be close to 50,000 tons/year.
From the perspective of various types of fluorine products, the entry of chlorofluorocarbons into the recession period will result in the emergence of a broad market for alternatives. As fluoropolymers enter the mature stage, the competition of the main product PTFE will intensify; With the development of China's auto industry, there will be a significant increase in fluoroelastomers; fluorine coatings will grow with the growth of construction and chemical industries; and fluorine-containing fine chemicals have the most extensive development space. At present, the gross profit margin of domestic CFC substitutes and CFC products is maintained at a level of over 20%. For fluoroelastomers, FEP, and even fluorine fine chemicals, market demand is strong and competition is weak. Will maintain more than 30% higher gross profit levels in the next 3 years.
The four major issues faced by the development of the fluorine chemical industry have recently been held in Hainan's 2007 Boao International Chemicals New Materials Forum. Some experts and scholars believe that the global fluorine chemical industry is focusing on areas where fluorite resources are concentrated, developing countries, and market potential. Large geographical transfer. China's abundant fluorite resources, a good investment environment, a vast market, and relatively low manufacturing costs have made international fluorinated industrial enterprises and processing companies enter into investments.
From the analysis of experts, the development of fluorine chemicals in China currently faces four major problems:
The first is that fluorite is used as a non-renewable resource and is disorderly mined and wasted. This issue has caused the country to pay attention to it. Since 1999, the country has protected fluorite resources as a strategic resource, began to implement a licensing system for the export of fluorite, and sealed up some newly discovered large-scale and oversized mines. At the same time, the mining rights of the mine are taken in open bidding. At present, the resources in East China have been gradually extracted, and the focus of mining has gradually shifted to the hinterland of Central China and the Northwest.
Second, fluorinated workers are faced with the pressures of environmental protection and safe operation because of their characteristics such as high corrosion of medium, difficulty in biodegradation of wastewater, and explosiveness of monomers. Fluorine chemical production enterprises are small in scale, single products, scattered layout, low-level redundant construction and vicious competition, and some companies have serious pollution. The development of the concept of "ferrorism" and the concept of "non-fluorine-containing fluorine" make people have misunderstandings about fluorine materials.
Third, weak basic research and applied research have restricted the subsequent development of fluorinated workers. In the entire industrial chain, domestic enterprises have certain competitiveness in the low-end products that are close to raw materials, but in the product areas with high added value, deep processing, and high technical requirements, they are basically occupied by foreign companies. Many companies invest only 1% to 2% of their sales revenue in technology development. Technology developers often have only 1/10 of the number of production and management personnel. Some companies do not even have developers. They just temporarily ask some experts to guide them on the spot. Therefore, in terms of high-end products, domestic companies have achieved industrial production on only a few products.
Fourth, the upstream and downstream links across industries are not close enough. Many companies mainly produce traditional and popular fluorine-containing intermediates. New types of fluorine-containing intermediates with complex structures containing heterocyclic rings have been researched and developed slowly with less production. The current situation of industrial competition is that there are many upstream domestic enterprises and competition is fierce. The downstream high-value-added products are occupied by foreign companies.
To this end, experts suggest that the coordination function of industry associations should be fully utilized to increase the protection of fluorite resources and the use of conservation, strengthen economic and technological exchanges and cooperation, complement each other's advantages, and promote the introduction and guidance of new materials to lead consumption. Enterprises should strengthen the division of labor and cooperation, segment the market, establish a competitive relationship, and create a development environment that is reasonable and orderly, coexistence and common prosperity.
CDM emissions trading will bring huge benefits to fluorine producers. To reduce the costs of developed countries meeting emission reduction targets, the Kyoto Protocol introduces three flexible emission reduction mechanisms: the Clean Development Mechanism (CDM), and joint implementation ( JI), Emission Trading (ET). Among them, CDM is the only emission reduction mechanism directly related to developing countries. Fluorine chemicals are currently the biggest beneficiaries of CDM projects. China's fluorine manufacturing companies can benefit from participating in CDM emission reduction transactions.
Taking Juhua as an example, as the first fluorine chemical company in China to implement CDM projects, the company signed an agreement with Japan JMD Corporation in August 2005. The total amount of 500 tons of HFC-23 decomposed items per year is not More than 40 million tons of greenhouse gas emission reductions will be transferred to the Japanese side at a price of not less than US$6.5 per ton. This will increase Juhua’s annual net profit in the seven years since 2007 by 46.667 million yuan. In September 2006, Juhuan again transferred to the UK Climate Change Capital Co., Ltd. the GHG emission reductions generated by the project. The total amount transferred shall not exceed 35 million tons, and the transfer price shall not be lower than 9 euros per ton. The successful implementation of this CDM project will increase Juhua’s net profit by 100 million yuan annually in the seven years since its implementation.
At present, the number of domestic fluorine chemical companies participating in CDM projects is increasing. The HFC23 decomposition projects of Shandong Dongyue, Jiangsu Meilan, Zhejiang Dongyang Chemical Co., Ltd. and Linhai Limin Chemical Co., Ltd. have been successfully registered in the United Nations. Zhejiang Juhua Phase II and Zhonglu Chenguang Research Institute have entered the UN registration process; The HFC23 decomposition project of Chemical Technology Co., Ltd. and Ying Peng Chemical Co., Ltd. has been approved by the Development and Reform Commission.
At present, there are about 30 HCFC production bases in the world, of which more than 20 are in China, and domestic large-scale F22 production companies have basically implemented or are implementing CDM projects. In 2005, China's F22 production capacity has reached 300,000 tons, and in 2007 it will reach 370,000 tons. Based on an output of 260,000 tons in 2005 and an average of US$9 per ton of CO2e, the implementation of the CDM project can bring about 250 million U.S. dollars of net income per year to the fluorine chemical industry in China (after deducting 65% of the country's charge).
CDM emissions trading will become a long-term effective mechanism. On March 13 this year, the British government announced a draft climate change bill, which determined that by 2020, the UK's carbon dioxide emissions will be reduced by 26% to 32% on the basis of 1990 and 60% by 2050. On March 8th, leaders of European Union member states unanimously agreed at the European Union’s spring summit to unilaterally commit to reduce EU greenhouse gas emissions by at least 20% in 1990 by 2020 and call on the United States. Other developed countries, as well as developing countries such as India, have adopted new emission reduction targets and strive to reach new international agreements after the Kyoto Protocol expires in 2012. This means that after 2012, the main provider of global greenhouse gas emission reductions is China and India, the two largest developing countries. The spirit of the "Kyoto Protocol" will continue after 2012. The establishment of more and more global climate exchanges also shows that CDM emissions trading will become a long-term effective mechanism.
China ranks second in the world in carbon dioxide emissions, and emissions of methane, nitrous oxide, etc. are among the highest in the world. It is the developing country with the greatest potential for reducing greenhouse gas emissions. At present, China's successful registration of emission reductions in the United Nations has reached 46.5 million tons of CO2e, which exceeds 40% of the total registered successful emission reductions, and the number of registered emission reductions ranks first in the world. However, the number of successfully registered projects in China is only 39, far lower than India, Brazil, Mexico and other countries. It seems that China's fluorine manufacturing companies still have great potential for CDM emission reduction trade.

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