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Tangshan Sanyou Chemical Soda Ash and Chlorine Alkali Industry Continue to Expand
In the first half of this year, Sanyou Chemical's soda ash and chlor-alkali industries continued to grow rapidly, gradually forming a "two alkalis" production model that boosted both output and efficiency. According to the company’s semi-annual report released today, revenue reached 1.69 billion yuan, operating profit was 220 million yuan, total profit was also 220 million yuan, and net profit amounted to 150 million yuan—showing year-on-year growth of 46.12%, 110.65%, 111.29%, and 95.62% respectively. Earnings per share stood at 0.28 yuan.
Under the strategic guidance of "horizontal development for scale expansion, vertical integration for industrial chain optimization, and diversified operations across sectors," Sanyou Chemical has steadily expanded its soda ash production while aggressively developing the chlor-alkali industry. This dual focus has led to the formation of a "two alkalis" production structure. In the first half of the year, the company produced 812,800 tons of soda ash, 28,900 tons of calcium chloride, 56,000 tons of caustic soda, and 57,800 tons of PVC, significantly enhancing economies of scale and driving substantial revenue and profit growth.
Three major projects under construction have entered the trial phase, with expectations of boosting production capacity in the second half of the year. These include a 200,000-ton PVC and caustic soda project, a calcium chloride expansion initiative, and the second phase of a thermal power project. The PVC and caustic soda project was completed by the end of June, with the PVC system starting operations in early July. The calcium chloride expansion project is 92.89% complete, with a 50,000-ton/year granular anhydrous calcium chloride plant currently in trial operation, and a 60,000-ton/year granular dihydrate plant under construction. The second phase of the thermal power project is 89.15% complete and now in trial operation. Additional projects, such as two new carbonization towers and a circulating water cooling system upgrade, are more than halfway finished.
In terms of energy saving and emission reduction, Sanyou Chemical has implemented seven projects and is currently working on eight more, all expected to be completed and operational within the year. Notably, the company’s ammonia-alkali waste liquid and chlor-alkali calcium carbide slag comprehensive utilization project was included in the seventh batch of national resource conservation and environmental protection projects in 2006, receiving a central government grant of 10 million yuan.
Raw material shortages and the impact of reduced export tax rebates have become significant challenges due to declining salt field areas and rising demand for raw salt. Additionally, increased government regulation on high-pollution and high-energy-consuming industries like coal and coking has tightened the supply of raw materials. To ensure a stable supply of raw salt, Sanyou Chemical has initiated direct supply arrangements in Shandong, reinforcing local supply chains. It also plans to strengthen existing coke supplies and cultivate 1–2 key channels to balance the supply structure and mitigate market risks.
Furthermore, the recent adjustment to China’s export tax rebate policy will affect Sanyou Chemical’s operations. Starting July 1, 2007, the soda ash export tax rebate rate dropped from 13% to 0%, while the PVC rate fell from 11% to 5%. This change is expected to reduce the company’s 2007 total profit by 46 million yuan. To counteract this, Sanyou Chemical plans to increase product export prices, explore cost-saving opportunities, and reduce production expenses.