Review and Outlook for China's Phosphorus Chemical Industry   

By Wang Peilin, China Inorganic Salt Industry Association

1. Review of China's phosphorus chemical industry during 2005-2010

In China, there are now more than 110 types of inorganic phosphorus chemical products, of which 60-70 types are regularly mass-produced; and more than 500 inorganic phosphorus chemicals producers are distributed in the 29 provinces and autonomous regions except for Tibet. By the end of 2010, the country's inorganic phosphorus chemical industry (hereinafter referred to as "the industry") had a total production capacity of 18.5 million t/a, an annual output of 10.2 million tons, an annual export volume of 2 million tons (with an annual export value of US$ 1.442 billion), an annual sales revenue of RMB52.4 billion, and an annual pre-tax profit of RMB10.2 billion.

1.1 Output grew faster than capacity

During 2005-2010, the industry's output grew 7.0%, while its capacity grew only 0.8%; and its total sales revenue and pre-tax profit grew 16.1% and 17.8% respectively, much faster than its output, indicating that the whole industry's efficiency had increased. The output of the industry's three major products - yellow phosphorus, sodium tripolyphosphate and feed-grade calcium phosphate - grew slowly. The output of sodium tripolyphosphate even decreased (-4.8%). The development of wet-process phosphoric acid and the growing consumption of food-grade phosphoric acid led to a rapid growth in the demand for commercial phosphoric acid. The use of sodium hexametaphosphate in water treatment and as a food additive drove up its consumption. The development of fire extinguishing agents boosted the development of ammonium polyphosphate. The growth of exports and of domestic chemical plating pushed the production of sodium hypophosphite. The production of chlorides also increased rapidly. The outputs of phosphorus trichloride, phosphorus pentachloride, phosphorus pentoxide and phosphorus pentasulfide all grew more than 10% annually, on average; and the output of some products, such as phosphorus pentachloride, even grew as much as 45% annually.

1.2 Imports and exports changed greatly

During 2005 - 2010, China's import volume of phosphorus chemicals dropped significantly, by 21.4% annually, on average; and the average import price of the products increased from US$ 395.9 /t in 2005 to US$1 623 /t in 2010. This indicates that the country's self-sufficiency rate for phosphorus chemicals has increased, and that products now being imported are mostly high-value-added fine products (see Table 1).
                                    
Table 1  Imports and exports of China's major phosphorus chemical products                 (thousand tons)
Product    2000    2005    2009    2010    Export growth rate/%
        Imports    Exports    Imports    Exports    Imports    Exports    Imports    Exports    2000-2005    2005-2010
Yellow phosphorus    -    124    7.5    99.3    0    21.7    0    35.6    -4.35    -18.5
Phosphoric acid    42.6    126.9    23.2    268.8    14.0    504.5    18.1    489.8    16.2    12.75
Sodium tripolyphosphate    1.6    279    3.1    501.6    2.89    591.3    3.3    411    12.45    8.86
DCP    4.8    73.6    135.8    400.3    0.06    308.9    0.1    361    40.3    -2.1
Sodium hypophosphite    0.9    12.2    2.7    20.4    3    27    2.8    40    10.83    14.4
Phosphides    0.1    0.5    0.04    0.15    0    20.34    0    23    -21.4    173.6
Trisodium phosphate    0.6    9.6    0.33    17.7    0.16    22.4    0.13    24.7    13.0    6.89
Potassium phosphate    0.6    3.7    0.46    29.9    0.63    45.5    0    57.9    51.88    14.1
Monosodium & disodium phosphates    0.3    1    0.47    7.5    0.26    12.3    0.29    15.7    49.6    15.9
Phosphorus pentoxide    0.1    0.06    0.52    2.1    0.14    7    0.02    9    103.6    33.78
Total    51.8    631.6    166.7    1347.7    28.89    1855    49.9    1667    16.4    4.3
Total value /US$1 million    17    317    66    778    96    1342    81    1299    19.67    10.79

   During 2005-2010, the growth rate of China's phosphorus chemicals export value was 10.79%, higher than that of their export volume (4.3%), and their average export price grew from US$577 /t in 2005 to US$779 /t in 2010.The export of phosphides and phosphorus pentoxide increased especially rapidly, having an annual growth rate of 173.6% and 33.8%, respectively. All this indicates that the export of China's phosphorus chemical products has transformed from "quantitative progress" to "qualitative progress." The export of basic phosphorus chemical products, such as yellow phosphorus and feed-grade calcium phosphate, fell 18.5% and 2.1%, respectively. Among basic products such as phosphoric acid, dicalcium phosphate (DCP) and sodium tripolyphosphate, the export of hi