Since the beginning of this year, the price of melamine, the main raw material for melamine, has remained high, which has greatly increased its production costs. At the same time, the serious oversupply of the domestic melamine market is a foregone conclusion, and the impact of changes in the international market on the domestic market is also growing. Faced with this situation, industry veterans pointed out at the just-concluded Second China Melamine and Downstream Industrial Development Promotion Summit that the domestic melamine industry should increase domestic sales and increase exports, and seek breakthroughs by strengthening corporate collaboration.
Recently, the cost pressure on melamine has been increasing. In 2008, the price of urea as its main raw material remained high, and after the country introduced a policy of compulsory price caps, the ex-factory price was still generally higher than 1900 yuan/ton, resulting in a net increase of melamine costs of about 300 yuan per ton over the same period of last year; On the electricity side, several major power groups in China jointly signed a letter asking the State Council to request coal-fired linkage. Once the plan is passed, the tariff will be raised by more than 0.15 yuan/kWh. With the increase in inflationary pressures and the promulgation of the new labor law, companies will On the other hand, various types of insurance must be paid in accordance with the regulations, and labor costs should be more than 20% higher than before. In addition, the current tightening monetary policy in the country also increases the financial pressure on the construction and expansion of melamine projects.
Based on the above points, Min Haibo, deputy general manager of Sichuan Meiqing Cyanamide Co., Ltd., believes that the first half of the year is the traditional peak season for urea, but it is also the traditional low season for melamine. Melamine manufacturers must face this reality and cannot expect urea to lower prices in a short period of time. It can be asserted that domestic melamine plants, whether owned or not supplied with their own raw materials, are unlikely to be profitable if urea is fully accounted for at market prices.
From the perspective of market supply and demand, the contradiction between production and demand will also be further highlighted. In 2008, Ukrainian Petrochemical's 30,000-ton/year, Fengxi and DSM's joint venture, 30,000 tons/year, Gimhae's 15,000 tons/year and Deqilong's 15,000 tons/year will be put into operation; / Year, Junhua Group's 60,000 tons / year device is expected to be completed by the end of the year; there are some manufacturers have plans to expand, with a total capacity of 220,000 tons / year; and another 400,000 tons / year of new capacity is being demonstrated.
In addition, multinational giants have announced that they will make strategic adjustments to their melamine business within the next year or two and adopt joint ventures or sales to increase their influence in China, the Middle East, and the Black Sea region. On February 28, DSM and Fengxi Fertilizer officially announced the establishment of a melamine joint venture company. These moves by multinational companies will further expand domestic production capacity. At the same time, domestic demand growth is slowing. Since the second half of 2007, the Chinese government has introduced various policies to control housing prices, and the development of the decorative materials industry will also be constrained. It is expected that domestic domestic demand for melamine will grow slightly this year, but the total amount will still increase.
Industry veterans believe that China's melamine market can be said to be mixed this year. Despite the expansion of domestic production capacity, the uncertainty of actual supply increases, and the overall oversupply is a foregone conclusion. Affected by changes in demand and seasonal differences, the frequency of melamine market fluctuations will increase. Experts said that under such circumstances, the development of China's melamine industry will become more dependent on the international market, and its changes in demand will have a greater impact on the domestic market.
Fortunately, the demand in the international market continued to increase in 2008. Affected by the continuous rise in international energy prices, foreign melamine projects are too costly and do not rule out the possibility of some plants continuing to stop production and reduce production. The major global melamine consumer market has strong demand in Europe, North America, and Southeast Asia. Therefore, there is a gap in global market supply and demand, which is good news for the domestic melamine industry. It is expected that before the new large-scale installations in China are put into production, the increase in demand in the international market will continue for some time to come.
In the face of current domestic and international market conditions, experts pointed out that in terms of the development of the melamine industry in China, it is fundamental to increase domestic sales, and increasing exports is a hope. Industry collaboration is the key. The main approach to increase domestic sales is to strengthen research and development of downstream products and expand melamine demand. For example, develop high-performance varieties to gradually serialize products; develop injection grade products to stabilize and improve product quality; strengthen applied research and develop applications such as tableware, electronic and electrical appliances, and foam plastics. Experts believe that the most important thing for this year's melamine industry is to strengthen macro-control and strengthen industry management and planning. Only in this way can we increase the international reputation of our country's melamine enterprises, increase our production technology, and enhance our industrial competitiveness.
Recently, the cost pressure on melamine has been increasing. In 2008, the price of urea as its main raw material remained high, and after the country introduced a policy of compulsory price caps, the ex-factory price was still generally higher than 1900 yuan/ton, resulting in a net increase of melamine costs of about 300 yuan per ton over the same period of last year; On the electricity side, several major power groups in China jointly signed a letter asking the State Council to request coal-fired linkage. Once the plan is passed, the tariff will be raised by more than 0.15 yuan/kWh. With the increase in inflationary pressures and the promulgation of the new labor law, companies will On the other hand, various types of insurance must be paid in accordance with the regulations, and labor costs should be more than 20% higher than before. In addition, the current tightening monetary policy in the country also increases the financial pressure on the construction and expansion of melamine projects.
Based on the above points, Min Haibo, deputy general manager of Sichuan Meiqing Cyanamide Co., Ltd., believes that the first half of the year is the traditional peak season for urea, but it is also the traditional low season for melamine. Melamine manufacturers must face this reality and cannot expect urea to lower prices in a short period of time. It can be asserted that domestic melamine plants, whether owned or not supplied with their own raw materials, are unlikely to be profitable if urea is fully accounted for at market prices.
From the perspective of market supply and demand, the contradiction between production and demand will also be further highlighted. In 2008, Ukrainian Petrochemical's 30,000-ton/year, Fengxi and DSM's joint venture, 30,000 tons/year, Gimhae's 15,000 tons/year and Deqilong's 15,000 tons/year will be put into operation; / Year, Junhua Group's 60,000 tons / year device is expected to be completed by the end of the year; there are some manufacturers have plans to expand, with a total capacity of 220,000 tons / year; and another 400,000 tons / year of new capacity is being demonstrated.
In addition, multinational giants have announced that they will make strategic adjustments to their melamine business within the next year or two and adopt joint ventures or sales to increase their influence in China, the Middle East, and the Black Sea region. On February 28, DSM and Fengxi Fertilizer officially announced the establishment of a melamine joint venture company. These moves by multinational companies will further expand domestic production capacity. At the same time, domestic demand growth is slowing. Since the second half of 2007, the Chinese government has introduced various policies to control housing prices, and the development of the decorative materials industry will also be constrained. It is expected that domestic domestic demand for melamine will grow slightly this year, but the total amount will still increase.
Industry veterans believe that China's melamine market can be said to be mixed this year. Despite the expansion of domestic production capacity, the uncertainty of actual supply increases, and the overall oversupply is a foregone conclusion. Affected by changes in demand and seasonal differences, the frequency of melamine market fluctuations will increase. Experts said that under such circumstances, the development of China's melamine industry will become more dependent on the international market, and its changes in demand will have a greater impact on the domestic market.
Fortunately, the demand in the international market continued to increase in 2008. Affected by the continuous rise in international energy prices, foreign melamine projects are too costly and do not rule out the possibility of some plants continuing to stop production and reduce production. The major global melamine consumer market has strong demand in Europe, North America, and Southeast Asia. Therefore, there is a gap in global market supply and demand, which is good news for the domestic melamine industry. It is expected that before the new large-scale installations in China are put into production, the increase in demand in the international market will continue for some time to come.
In the face of current domestic and international market conditions, experts pointed out that in terms of the development of the melamine industry in China, it is fundamental to increase domestic sales, and increasing exports is a hope. Industry collaboration is the key. The main approach to increase domestic sales is to strengthen research and development of downstream products and expand melamine demand. For example, develop high-performance varieties to gradually serialize products; develop injection grade products to stabilize and improve product quality; strengthen applied research and develop applications such as tableware, electronic and electrical appliances, and foam plastics. Experts believe that the most important thing for this year's melamine industry is to strengthen macro-control and strengthen industry management and planning. Only in this way can we increase the international reputation of our country's melamine enterprises, increase our production technology, and enhance our industrial competitiveness.
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