Fan Xide, general manager of Jiangsu Xuzhou Tianjia Food Chemical Co., Ltd.: Overcapacity results in yellow phosphorus and its downstream products can not be worth the long-term value, the value of strategic resources is difficult to reflect in a competitive market. The continuous price war of smoke has consumed the huge profits that should have been attributed to the production companies. It is a great deplorable! What is even more irritating is that trade frictions caused by low-cost sales allegedly caused in recent years have continued. For example, on November 6 this year, the US International Trade Commission initially ruled that imported potassium pyrophosphate, potassium dihydrogen phosphate and phosphoric acid from China. Dipotassium hydrogen is levied "double reverse" tariffs. In fact, China is still a country with relatively poor potassium resources. Every year, it imports a large amount of potassium from Jordan, Russia and other countries. It can be seen that cheap exports of scarce resources have led to trade sanctions, which is not worth the candle. This should be the cause of excess capacity.
Sun Kai, general manager of Jiangsu Malong Guohua Industry and Trade Co., Ltd.: Yellow phosphorus overcapacity directly led to the market supply and demand has entered a vicious circle: When the macro electricity supply situation is relaxed, especially the main producing areas of yellow phosphorus, clouds, expensive places in Fengshui During the period, domestic yellow phosphorus supplies are abundant, and their market prices have been declining all the way. They can often fall from highs to below the cost line, forcing most companies to stop production or restrict production; and when the market supply gradually decreases until it is tight, Huang Phosphorus prices have soared in a short period of time under the swift purchase of downstream companies and trading companies. This will inevitably lead to the revival of surplus production capacity that is in a state of potentiality. This will lead to a sharp increase in supply, which will undoubtedly soon undermine this market again. It can be seen that overcapacity has led to a sharp rise and fall in the yellow phosphorus market. This condition must be transmitted downstream through the mode of replication, and the performance of the phosphate market is also fluctuating.
Industry insiders talk about excess phosphorus deficiency
All of them are the cause of overcapacity. Gao Baoqing, deputy general manager of Hubei Xiangfan Juli Industrial Chemicals Co., Ltd.: The excess production capacity of yellow phosphorus makes it difficult to build a more coordinated and orderly industrial chain with the downstream, so that the supply and demand of the two are imbalanced. At present, China's yellow phosphorus production capacity is still maintained at more than 1.5 million tons, but the effective demand is maintained at about 800,000 tons per year. In order to balance the excess yellow phosphorus production capacity, yellow phosphorus producers often extend themselves downstream. This undoubtedly led to the disorderly expansion of the phosphate industry away from total demand, triggering a turbulence in the entire supply and demand relationship. This situation will inevitably make the competition in the industry normal, cruel, and ineffective. For this reason, phosphate companies have not been able to get out of the production trough and survival difficulties, but also unable to carry out product structure adjustments and industrial upgrading, thereby enhancing the core competitiveness in the international market.