"A carrot with two cuts" is a very popular word among domestic fertilizer companies recently. This means that the raw material market for chemical fertilizer production has been fully liberalized, and the market can continue to raise prices, while the highest ex-factory price of fertilizer products has always been subject to state price constraints, and cannot be adjusted according to market supply and demand and cost changes. In an investigation recently, the author discovered that many chemical fertilizer companies that are in the predicament of “cutting both sides†but have a foresight are actively seeking to break the board and some have achieved certain results.
At present, in the overall shortage of natural gas supply, Zhongyuan Dahua Group, in addition to relying on the planned supply of oilfield supplies, also buys some natural gas from small chemical fertilizer plants. Because these small chemical fertilizer plants have certain natural gas resources, the production costs are relatively high and it is not worthwhile to carry out production. The group bought their natural gas and then made economic compensation for these small fertilizer plants.
After the era of high fertilizer prices, a single product structure increased the company's operating risk. Therefore, many fertilizer companies began to consider breaking out from the perspective of diversification. Dai Xuanzhong, deputy general manager of Guizhou Chitianhua Co., Ltd., said that one of the main products of Chitianhua is urea, and the raw materials are mainly natural gas. Under the current circumstances, if only focusing on the “gas head†urea product, the company The way out will become narrower. So on the raw material route, they began to turn to "coal heads." In terms of product structure, companies have also begun to implement a diversification strategy. Considering the abundant bamboo in the surrounding areas, the company has developed a pulp board production line using bamboo as raw material.
The industry generally believes that the arrival of the raw material tension era has further widened the gap between enterprises. Only companies that adapt to the new situation as soon as possible and learn to avoid and decentralize market risks can stand out from the ever-changing market.
At present, in the overall shortage of natural gas supply, Zhongyuan Dahua Group, in addition to relying on the planned supply of oilfield supplies, also buys some natural gas from small chemical fertilizer plants. Because these small chemical fertilizer plants have certain natural gas resources, the production costs are relatively high and it is not worthwhile to carry out production. The group bought their natural gas and then made economic compensation for these small fertilizer plants.
After the era of high fertilizer prices, a single product structure increased the company's operating risk. Therefore, many fertilizer companies began to consider breaking out from the perspective of diversification. Dai Xuanzhong, deputy general manager of Guizhou Chitianhua Co., Ltd., said that one of the main products of Chitianhua is urea, and the raw materials are mainly natural gas. Under the current circumstances, if only focusing on the “gas head†urea product, the company The way out will become narrower. So on the raw material route, they began to turn to "coal heads." In terms of product structure, companies have also begun to implement a diversification strategy. Considering the abundant bamboo in the surrounding areas, the company has developed a pulp board production line using bamboo as raw material.
The industry generally believes that the arrival of the raw material tension era has further widened the gap between enterprises. Only companies that adapt to the new situation as soon as possible and learn to avoid and decentralize market risks can stand out from the ever-changing market.
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