Herbicides China News 201101.pdf

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Herbicides China News

Vol.4 Issue 01 2011 Publications date: 14 Jan. 2011

Herbicides China News Vol.4 Issue 01 2011

CCM International Limited www.cnchemicals.com

China Crop Protection Summit 2011 Will be held during 18 - 19 March, Shanghai

Welcome to join with us.Click here for Event Details.

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Coming Reports from CCM:- Global Commercial Opportunities Derived from Glyphosate Industry - Production and Market of

Fenoxaprop-P-ethyl in China- Survey of Amide Herbicides in China- Corn Herbicides Survey in China

Ready Market Reports:- Survey of Pesticide Industry in China –Edition 2 (Launched in Sep. 2010)- Outlook for China Glyphosate Industry 2009-2014- Future Prospect of Genetically Modified Crops- Production and Market of Paraquat in China - Nicosulfuron Survey in China- The Survey of 2,4-D in China - Nicosulfuron Survey in China- Glycine Survey in China- Glycine Survey in China

- MIPA Survey in China- IDAN Survey in China

CCM newsletters related to Herbicides:- Crop Protection China News- Insecticides China News- Fungicides China News- Glyphosate China Monthly Report

CCM trade analysis related to Herbicides:- Glyphosate- Clomazone- Paraquat- Fluroxpyr- Dicamba- 2,4 D- ……

■ Overview ..................................................................................................12010 top 10 events in Chinese herbicide industry ........................................................................................... 1Overview of Chinese herbicide industry in 2010 .............................................................................................2China’s seven self-developed herbicides in the past ten years ........................................................................4

■ Survey & Interview .................................................................................. 5Brief survey of crop protection in Leizhou Peninsula .....................................................................................5

■ Company Dynamics ................................................................................. 6Lier Chemical purchases Jiangsu Kuaida ........................................................................................................6Nantong Jiangshan sells Nantong Jiangtian’s share ....................................................................................... 7Henan Yingtai constructs acetochlor quietly ...................................................................................................8Fengshan Group consolidates leading trifluralin position ..............................................................................8

■ Market Analysis ....................................................................................... 9Dicamba attracts pursuers’ interest .................................................................................................................9Metolachlor threatens acetochlor in China .................................................................................................... 10

■ Supply & Demand ................................................................................... 11Anhui Fengle expands tribenuron-methyl production ...................................................................................11Hubei Huida suspends bispyribac-sodium production ..................................................................................11All self-produced metamitron are exported in China .................................................................................... 12Good Harvest-Weien to pursue 2,4-D ........................................................................................................... 13

■ Price Analysis ......................................................................................... 13- Price Review .......................................................................................................13Monthly market prices of main crops in China, Jan. 2011 ............................................................................ 13Monthly ex-factory prices of key raw materials, Jan. 2011 ........................................................................... 14Monthly ex-factory prices of main herbicides, Jan. 2011 .............................................................................. 14Monthly Shanghai port prices and FOB Shanghai of main herbicides, Jan. 2011 .........................................15- Pricing ................................................................................................................15Overview of Chinese glyphosate price in 2010 ...............................................................................................15

■ News in Brief ..........................................................................................16Chinese herbicide technical output increases in Nov.2010 ........................................................................... 16UN not to ask anti-dumping tax against Chinese glyphosate in 2011 ........................................................... 16Fujian Sannong's relocation ........................................................................................................................... 16New herbicide products in 2011 ..................................................................................................................... 16Chinachem to purchase MA Industries ......................................................................................................... 16

Content

http://www.cnchemicals.com/Event/Crop_Protection_2011/EventHomepage.html

http://www.cnchemicals.com/Report/ProposalDetail.aspx?rptid=1566



http://www.cnchemicals.com/Report/ReportMin.aspx?rptid=1551















http://www.cnchemicals.com/Newsletter/CropProtectionChinaNews.shtml

http://www.cnchemicals.com/Newsletter/InsecticidesChinaNews.shtml

http://www.cnchemicals.com/Newsletter/FungicidesChinaNews.shtml

http://www.cnchemicals.com/Newsletter/GlyphosateChinaMonthlyReport.shtml

http://www.cnchemicals.com/Newsletter/GlyphosateChinaMonthlyReport.shtml


CCM International Limited www.cnchemicals.com

■ Top 10 events in Chinese herbicide industry during 2010 are listed in this issue.

■With hard work and sound regulations, there's no doubt that Chinese herbicide industry is going towards brilliant direction.

■During the past ten years (2000 - 2010), China has developed 7 herbicides.

■According to CCM International's survey, herbicide is not popular as expected in Leizhou Peninsula, owing to large planting areas of sugarcane with low profit.

■ Lier Chemical’s acquisition of Jiangsu Kuaida was approved on Dec. 30th 2010.

■Nantong Jiangshan sold Nantong Jiangtian’s 19.65% share to Nantong Industries.

■According to one intelligence gained from locally official website of Puyang City, Henan Province, Henan Yingtai is planning a 10,000t/a acetochlor production line.

■ Fengshan Group constructs two production lines of 5,000t/a trifluralin and 300t/a prodiamine.

■Dicamba development is driven by GM technology in the world.

■Domestic metolachlor threatens but can’t substitute acetochlor in the short term.

■Anhui Fengle is constructing a new 300t/a tribenuron-methyl production line with confidence on future market.

■Hubei Huida has suspended its bispyribac-sodium production for the Chinese Spring Festival in Feb.2011.

■All metamitron products in China are exported to overseas market by only one domestic manufacturer, Hebei Wanquan.

■Good Harvest-Weien plans to construct a 10,000t/a 2,4-D production line.

■ The prices of Chinese glyphosate products in 2010 witnessed stagnant situation.

Headlines of Herbicides China News 1101Welcome to Jan. 2011 issue of Herbicides China News published by CCM International, a professional consulting company who has been extensively and intently focusing on dynamics of China’s herbicide industry.

At the opening of 2011, we turn around to review Chinese herbicide industry in 2010 and find that the situation of Chinese herbicide industry is not so awful as we thought before. In the past one year, some aggressive events inspired our confidence such as Lier Chemical’s successful acquisition, Jiangsu Huifeng’s getting listed, the recovery of glyphosate market, etc.

Meanwhile, warm winds blow into 2011. Nanjing Redsun’s reorganization, rebounding herbicide prices, Chinese government’s Twelve-Fifth Plan and so forth all imply the recovery of agrochemical market in China.

But it is always necessary to have a careful attitude towards potential risks such as overcapacity and vicious competitiveness, because the way to innovation of Chinese pesticide industry is so long and rugged.

In addition, in Dec. 2010, CCM International visited Leizhou Peninsula to inspect the local situation of agriculture and crop protection market. Hope the information obtained from the practical interview could bring you new and inspiring feeling. And the improvements on the issue in 2011 are always waiting for your kindly comments.Your suggestions are highly appreciated at [email protected]. Main companies mentioned

in this issue

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CCM International Limited www.cnchemicals.com1

2010 top 10 events in Chinese herbicide industry

1. On 31 January, Chinese government proclaimed 2010 No.1 Document of the Central Committee formally,

attaching much importance again to three agricultural issues (agriculture, rural areas and farmers) in China. The document has listed the objects for agricultural development in 2010, including accelerating rural urbanization of counties, increasing agricultural input and subsidies, industrializing GM crops, etc.

No.1 Document is issued by Central Committee of Communist Party of China and the State Council every year, aiming to make guidance on agricultural development, etc. That means more attention to agriculture could indirectly boost Chinese herbicide development in 2010. 2. In Feb. 2010, Zhejiang Wynca Chemical Group Co., Ltd. (Zhejiang Wynca) held the Formal Operation Press Conference for new subsidiary namely Wynca Sunshine Agric Products&Trading Company Limited (Wynca Sunshine) in Kumasi, Ghana, indicating that Zhejiang Wynca started marching into West Africa market.

Wynca Sunshine was registered in Ghana and has two subsidiaries, namely Sunshine Agric Manufacturing in Ghana and Sunshine Agricole in Cote d'lvoire, focusing on the manufacture of farming tools and sales of pesticides. 3. Jiangsu Changqing Agrochemical Co. Ltd. (Jiangsu Changqing) got listed on 16th April 2010. During this IPO, Jiangsu Changqing issued 25 million shares on the base of 73.92 million shares to raise approximately USD180 million. What’s more, the capital raised from the IPO is being invested into the company’s 5 key projects, including three herbicide projects, namely 1,200t/a fomesafen technical project, 300t/a nicosulfuron technical project and 500t/a clethodim technical project.

As the leading fomesafen manufacturer with capacity of 1,200t/a in China, Jiangsu Changqing’s competitiveness in herbicide business will be enhanced greatly after these three projects launched. And the construction of these three projects is ongoing at present.

4. On 22nd June 2010, the Ministry of Finance and State Taxation Administration jointly promulgated The Note about Abolishment of Export Rebate of Some Commodities, showing that the export rebate on some commodities, including steel products, nonferrous metal, silver powder, alcohol and corn flour, pesticide, medicine and chemical products, as well as plastic, rubber and glass products, would be abolished on 15th July 2010.

According to the note, the export rebate on glyphosate techncial products with two ECCN (Export Control Classification Numbers: 29310000411 and 29310000412) would be abolished, indicating that domestic glyphosate industry will suffer more pressure from intense competition in the short term, but will develop toward healthy direction in the future with the government regulation.

5. In Oct. Lianhe Chemical Technology Co., Ltd. (Lianhe Chemical) announced that two IPO projects were launched, namely 2,500t/a halogenated aromatic nitriles project and the construction of research centre for advanced technology, marking Lianhe Chemical’s IPO constructions have been finished completely.

Two months before the two IPO projects are lunched, the company started operating another IPO project normally, 600t/a cyhalofop-butyl project. 6. Jiangsu Huifeng Agrochemical Co., Ltd. (Jiangsu Huifeng) got listed in China’s A -share market on Nov. 9th 2010. With unit price for per share of USD7.3, Jiangsu Huifeng raised approximately USD0.18 billion by issuing 25 million shares this time.

■ Overview



Overview of Chinese herbicide industry in 2010

In 2010, both Chinese herbicide pursuers and the government made

great effort to rescue the stagnant herbicide industry though it didn’t take effect at once. With hard work and sound regulations, there is no doubt that Chinese herbicide industry is going towards brilliant direction.

■ManufacturersBy reviewing Chinese listed agrochemical enterprises’ performance in 2010, it’s not difficult to realize that most of them witnessed poor business performance this year. But a few fortunate Chinese enterprises are patronized by good luck, such as Hebei Veyong Bio-chemical Co., Ltd. (Hebei Veyong).

With brilliant performance in Q3 2010, Hebei Veyong overturned deficit resulted from weak performance in the first half of 2010. The company’s net profit witnessed sharp growth of about 1,500% year on year to USD1.4 million. Following nice performance in Q3 2010, it is estimated that Hubei Veyong will continue to achieve earning money in Q4 2010, based on the whole recovering pesticide market in China and the company’s sound operation.

In fact, no mater how the performance is in 2010, almost all Chinese agrochemical enterprises have make great efforts to shake off the gloom resulted from the financial crisis and tried hard to adapt to the intense

environment. Getting listed in capital market, integrations between industrial enterprises, relocations into industrial park and investment into upstream or downstream productions and so forth are underway continuously in 2010.

All these actions accord with development trend of Chinese pesticide, implying that these wise enterprises can witness nice prospect in the future, further signaling that the reorganization in Chinese pesticide industry is ongoing quietly.

■ PoliciesAiming to accelerate the industrial reorganization, Chinese government also achieved many effective

It’s also reportedly said in the prospectus that the capital of USD95 million raised from the IPO would be invested into the company’s 6 key projects. Among them, 3 projects belong to the constructions of technical productions, including 3,000t/a prochloraz technical, 1,000t/a epoxiconazole technical and 10,000t/a bromoxynil octanoate technical.

Jiangsu Huifeng, an appointed pesticide producer and founded in 1989, is well-known in home agrochemical market with the globally largest prochloraz capacity of 3,800t/a, and is the No.1 bromoxynil octanoate manufacturer in China meanwhile. In past three years, Jiangsu Huifeng achieved so excellent performance that the company’s net profit witnessed continuous growth year by year. 7. Released by official website, http://www.cninfo.com.cn/, at 6:30 on Dec. 2nd, Nanjing Redsun decided to suspend stock trade from the same day, primarily because China Securities Regulatory Commission (CSRC) will conduct examination for Nanjing Redsun’s assets reorganization recently. After four days, the examination was finished and Nanjing Redsun’s share resumed, signaling that Nanjing Redsun’s reorganization is drawing to an end.

According to Nanjing Redsun’s original plan, three brother companies will be integrated into Nanjing Redsun, namely Nanjing Redsun Biochemical Co., Ltd., Anhui Guoxing Biochemical Co., Ltd. and Nanjing Redsun International Trade Co., Ltd. Coupled with share acquirement, three brothers’ assets and Nanjing NFP Group’s some pesticide resource will be injected into Nanjing Redsun.

8. On 19th Sept. 2010, a directory document named Pesticide Industry Policy was formally promulgated by Chinese government. The policy is made to accelerate the reorganization and maintain sustainable development of pesticide industry by relocating into chemical parks, controlling overcapacity, integrating production resource, pushing environmental protection, developing new technology and enhancing the government supervision, etc. In terms of herbicide industry, with achievement of the policy, the recovering pesticide industry will directly drive herbicide industry to boom. 9. At 5:40 a.m. on Dec. 8th, an accidental blast happened in Shandong Zhongshi Chemical Company (Shandong Zhongshi)’s plant located in Yanggu County, Shandong Province. Until about 18 o’ clock on Dec. 9th, the tragic fire was basically put out. It’s reportedly said that seven victims suffered from the accident, and are under stable condition at present. Moreover, the residents around the plant had evacuated to safety zone.

With acetochlor capacity of 10,000t/a, Shandong Zhongshi was listed in top 20 amide herbicide manufacturers in China. Hence, negative influence from the fire accident may force local government to reinforce regulation on pesticide production in China. 10. By the end of 2010, it’s reportedly said that EU will not resume anti-dumping tax against Chinese glyphosate in 2011 after the anti-dumping application cancelled by The European Glyphosate Association in Sept. 2010. Before the cancellation, Chinese glyphosate manufacturers had to pay 29.9% anti-dumping tax to EU for Chinese glyphosate technical exported to EU.



regulations in 2010, like the abolishment of glyphosate technical export rebate, price upregulation of some energy such as electricity and natural gas, No.1 Document of the Central Committee inclining on agriculture, etc.

Among them, the formal issue of Pesticide Industry Policy on 19th Sept. 2010 indicates that Chinese pesticide industry has already started innovation trip. Although the future is unknown at present, the gradually recovering market signals that there is a hopeful prospect.

What’s more, external conditions for Chinese herbicide are turning better. Currently, EU decided not to resume anti-dumping tax against Chinese glyphosate. As for glyphosate manufacturers in China, it’s undoubtedly a good news.

■ PriceAlthough many efforts on pesticide were made, on the whole, the prices of herbicide products in China still stayed at low level in 2010 over 2009. As usual, most prices of herbicides in 2010 are subject to the market disciplines, increasing during peak sales season.

For example, impacted by severe financial crisis in 2009, the prices of glyphosate, paraquat and acetochlor all witnessed sharp drop during 2009, and the price downturn still continued in 2010. However, with recovery of herbicide industry in China, the prices of these three main herbicides mentioned above rose apparently at the end of 2010.

■ Production & ExpansionCompared with that in 2009, the capacity expansion of herbicide production lines in China has slowed down in 2010, threatened by domestic overcapacity and overseas small demand. But Jiangsu, Shandong and Zhejiang are still the main herbicide production areas in China.

In terms of herbicide varieties with capacity expansion, small breed herbicides with excellent effect, low

toxicity, low pollution, etc. grasped lots of Chinese manufacturers’ interest in 2010, such as cyhalofop-butyl, clodinafop-propargyl, glufosinate-ammonium, clethodim, mesotrione and so on.

On the contrary, the capacity expansion of traditional herbicides like glyphosate and paraquat was not achieved too much, though these varieties are still positioned on the top of popular herbicides in China.

■ Consumption & marketOn the base of stably increasing consumption, the consumption structure of herbicide in China hasn’t greatly changed in 2010. But, abnormal climate in the first half of 2010 led to serious agricultural disasters, which impacted on total demand of herbicide in China.

In addition, some governmental policies also impacted on herbicide market in 2010. For instance, the stop production of 10% glyphosate SL from 2010 on is resulted from governmental regulation.

In terms of China’s herbicide export, the situation didn’t change too much in 2010, because recovering global market supported herbicide export demand. What’s more, Southeast Asian and America are the main destinations of China’s herbicides, with glyphosate enjoying the largest

export volume.

■RegistrationChinese government’s strict regulations on glyphosate registration resulted in its declining registration number in 2010. According to the regulation implemented since 2008, large part of temporary pesticide registrations have turned to be more formal; the registration now can only be renewed every five years instead of one year. Thus, the extended renewal time leads to dropping registration number in China directly.

Compared with that in 2009, the record high of 299 registrations in 2010 (the number of registrations in Jan. and April) is less than a half of 783 registrations in April 2009.

■ Prospect in 2011Walking into 2011, Chinese herbicide industry will not only recover further from gloom casted by the financial crisis, but also encounter huger challenges, with pesticide industrial development ongoing in China.

Whatever, there are many unknown factors in Chinese herbicide industry, and those manufacturers who desire to pursue more profit in intense competition should continue being careful and working hard to occupy one living place.

In addition, it will undoubtedly

Figure 1: Price trend of three main herbicides in China, 2009 & 2010

Source: CCM International

2,000

2,400

2,800

3,200

3,600

4,000

Jan.2009

March May July Sept. Nov. Jan.2010

March May July Sept. Nov.

Mon

thly

ave

rage

pric

e: U

SD/t

95% Glyphosate technical 42% Paraquat technical 92% Acetochlor technical



China’s seven self-developed herbicides in the past ten years

take the pesticide industry a long time to achieve the industrial reorganization. Thus, in coming 2011, herbicide even pesticide industry will still creep on the way of reorganization.

During the past ten years (2000 - 2010), China has developed

32 pesticides, including seven patent herbicides which has gained registrations. Supported by Chinese government, accumulative sales value of these 32 pesticides exceeded USD0.29 billion.

As for herbicides, seven varieties are included, they are monosulfuran, monosulfuran-ester, pyribambenz-propyl, ZJ0702, H9201, methiopyrsulfuron and HW-02.

■Monosulfuran & Monosulfuran-esterRegistered by Tianjin Green Agrochemical S&T Co., Ltd. and developed by Nankai University, monosulfuran (PD20070368 for 10% WP, PD20070369 for 90% technical) and monosulfuran-ester (LS20041086 for 10%WP, LS20041087 for 90% technical, both expired) can inhibit ALS enzyme in plant cells to control most annual broadleaf weeds and some annual grassy weeds in wheat field. Comparatively, the activity of monosulfuran-ester is stronger than that of monosulfuran. Generally, 22.5g monosulfuran-ester AI can take nice effect in one hectare field.

■ Pyribambenz-propyl & ZJ0702Both belonging to miazines herbicides, pyribambenz-propyl and ZJ0702 which could control annual grassy weeds and some broadleaf weeds in rape field were jointly developed by Zhejiang Chemical Industry Research

Institute and Chinese Academy of Science. Although both two herbicides acquired registrations in 2003, all have expired.

■H9201Generally, H9201 is specially applied to controlling grassy and broadleaf weeds in carrot field. Developed by Nankai University in 2003, H9201 was firstly registered by Nantong Jiangshan Agrochemical& Chemical Co., Ltd. in 2005, namely 20% EC (LS20051935) and 95% technical (LS20051937). But two registrations had expired and new ones haven't achieved yet.

■MethiopyrsulfuronBelonging to one new sulfonylurea herbicide, methiopyrsulfuron can be applied in wheat field to control dicotyledonous weeds and some monocotyledonous weeds such as barnyard grass. It was developed by Hunan Research Institute of Chemical Industry and registered in 2006 by Hunan Haili Chemical Industry

Co., Ltd. (LS20060229 for 10% WP, LS20060244 for 95% technical, both expired).

■HW-02Registered as lawn herbicide by Shandong Qiaochang Chemical Co., Ltd. in 2007 (LS20071694 for 30% EC), HW-02 can control dicotyledonous weeds effectively and is safe for grassy plants. Besides the use in lawn field, HW-02 can also be used in fields of rice, wheat and corn. Generally, HW-02 with dosage of 30~40g AI per hectare can take nice effect on weed control.

Aiming to drive self-developed pesticides to develop smoothly in China, , Chinese Alliance of Innovative Pesticide Technology was established in April 2010. It’s estimated that more than ten newly developed pesticides will gain registrations in China in the next ten years.

Figure 3: Chemical structure of methiopyrsulfuron, 2011

Figure 2: Chemical structure of monosulfuran & monosulfuran-ester, 2011

monosulfuran monosulfuran-ester

NO2

SO2NHCHNN

N

CH3OCOOCH3

SO2NHCNHN

NCH3

O

Table 1: Registration situation of pyribambenz-propyl and ZJ0702, 2011

ProductRegistration

numberContent Company

Pyribambenz-propyl

LS20042529 10% SC

Shandong Qiaochang Chemical Co., Ltd.

LS20031547 10% ECLS20031544 technical

ZJ0702LS20031546 10% ECLS20042530 10% SCLS20031545 technical


COOCH3

SO2NHCONHN

NSCH3

OMe



Brief survey of crop protection in Leizhou Peninsula

■ Survey & Interview

In Dec. 2010, CCM International visited Leizhou Peninsula located

in the south of Guangdong Province to inspect the local situation of agriculture and crop protection, finding that sugarcane as a main economic crop in Leizhou Peninsula dominates local agriculture but consumes a relatively small volume of herbicides. So the total consumption volume of herbicides in Leizhou Peninsula is also very small.

Located in South China’s tropical zone, Leizhou Peninsula abounds in tropical economic crops like sugarcane, rubber, sisal, the primary agricultural crops. Especially, the planting areas of sugarcane account for over 70% of the total. The rice and wheat, main crops in China, could be harvested twice or three times in one year in Leizhou Peninsula, but their plant areas are very small.

Therefore, general herbicide such as those applied in rice field have only a few consumers in Leizhou Peninsula. Theoretically, non-grain crop herbicides such as sugarcane herbicides could meet nice market in this area.

Are non-grain crop herbicides really as popular as estimated in Leizhou Peninsula? With this question, CCM International arrived in Leizhou

Peninsula on 5th Dec.2010 to collect first-hand information and survey local actual situation of agriculture and crop protection.

In this survey, five large state farms which are located in south and north of Leizhou Peninsula are chosen. We found that more tropical crop varieties are planted in lower latitude areas and sugarcane predominates as the largest crop in this area.

Surprisingly, herbicide market in Leizhou Peninsula is smaller than other places like North China. Even if sugarcane herbicides includes 2,4-D, atrazine and MCPA which own stable market share in China, on the whole, sugarcane herbicides also witnesses

cool market resulted from low profit in planting sugarcane.

According to the workers in the five stare farms we have visited, the price of sugarcane in Leizhou Peninsula is relatively low, floating around RMB300~400/t (USD45~60/t). Thus, application cost of sugarcane herbicides is set intentionally to avoid deficit risk.

In addition, althougth large part of farms have achieved the reform to family production responsibility system, the local government’s regulation on planting plan, such as the setting of hard measures, still exist, making annual net profit of contractors so small, which is also responsible for the small consumption volume of herbicides in this area, one officer in one of the five farms indicated.

On the whole, with regard to sales situation of herbicides in Leizhou Peninsula, traditional herbicides applied in sugarcane fields like MCPA, atrazine and 2,4-D appear more frequently on the storage rack than glyphosate and paraquat. It’s proved by local farmers that glyphosate is seldom used during their planting.

In fact, the price of sugarcane herbicides is at low level. The

Figure 5: Pineapple field in south of Leizhou Peninsula, 2010


Figure 4: MCPA with SPX formulation in package of 15mL, 2010




average price of sugarcane herbicides fluctuates around RMB2~5 (USD0.3~0.8) per packet of 15mL.Taking MCPA as an example, MCPA with SPX formulation in package of 15mL is priced at only RMB2 (USD0.3).

In addition, the logo of Shandong Qiaochang Chemical Co., Ltd. can

be seen frequently on the herbicide packages in Leizhou Peninsula. And the brands of famous companies like Sygenta and Nanjing Redsun Co., Ltd. can also be observed easily.

Resulted from different planting structures of crops, pesticide sales structure in the southern area of Leizhou Peninsula is different from

that in the northern area. Because more crop varieties in southern area where banana is largely planted, fungicide is demanded more sharply here than in northern area. By contrary, herbicide is a dominant pesticide category in northern peninsula.

Lier Chemical purchases Jiangsu Kuaida

■ Company Dynamics

On Dec. 30th 2010, Lier Chemical Co., Ltd. (Lier Chemical)

proclaimed the information on cninfo.com.cn that China Securities Regulatory Commission (CSRC) had approved the acquisition of Jiangsu Kuaida Agrochemical Co., Ltd. (Jiangsu Kuaida)’s over 64 million shares with per share price of USD0.39 since Dec. 28th. It’s the last administrative procedure for the acquisition from Chinese government, indicating that Lier Chemical could complete the

purchase immediately.

Although when Lier Chemical will achieve the deal is undercover, Lier Chemical’s share price witnessed sharp soar, stimulated by the good news about the approval from the government. According to Lier Chemical’s share price history on google website, the share price jumped by USD0.13 (RMB0.88) per share from that on Dec 29th to opening price of USD2.72/share (RMB18.00/share) on Dec. 30th. In the whole day,

Lier Chemical’s share price fluctuated on high level and closed on USD2.75/share (RMB18.21/share) finally.

It’s predicted that Lier Chemical’s share price will maintain the uptrend after the acquisition accomplished. As a relatively rapid way for the company’s further development, Lier Chemical’s acquisition of Jiangsu Kuaida will boost Lier Chemical’s competitiveness.

Especially, Jiangsu Kuaida’s complementary dominance aroused Lier Chemical’s interest greatly. As mentioned in the purchasing report, Jiangsu Kuaida owns diverse product mix, complete production chain and convenient geo-position. All these advantages are severely necessary for Lier Chemical’s future development.

Although Lier Chemical ranks No.2 among global chloropyridine herbicide producers by capacity and owns advanced Cyanopyridine Chloration Technology which can produce most key products of the company, namely clopyralid, picloram and fluroxypyr,

Figure 6: Lier Chemical's daily stock price trend, 2010 (Dec. 24th - Dec. 30th)

Note: Monetary unit is RMB/share Source: Google.com/finance

Figure 7: Jiangsu Kuaida’s annual performance, 2007 - 2009


0

20

40

60

80

100

Annu

al p

erfo

rman

ce: m

illio

n U

SD

2007 2008 2009

Net profit

Revenue



Nantong Jiangshan sells Nantong Jiangtian’s share

After Nantong Jiangshan Agrochemical & Chemicals

Co., Ltd. (Nantong Jiangshan)’s 19.65% holding share towards Nantong Jiangtian Chemicals Co., Ltd. (Nantong Jiangtian) is sold to Nantong Industries Holding Group Co., Ltd. (Nantong Industries), its holding share towards Nantong Jiangtian reduced to 22.23% from original 41.88%.

On Jan. 4th 2011, Nantong Jiangshan issued a bulletin about a deal between Nantong Jiangshan and Nantong Industries. As written in the bulletin, Nantong Jiangshan’s broad of directors had agreed to sell 19.65% holding share of Nantong Jiangtian to Nantong Industries.

As Nantong Jiangshan’s second share holder with holding proportion of 28.45%, Nantong Industries spent approximately USD4.4 million finishing the deal.

It’s investigated by CCM International that Nantong Jiangtian is a chemical intermediate manufacturer primarily engaged in production and sales of formaldehyde, paraformaldehyde

and methyl chloride. As one of Nantong Jiangtian’s founders, Nantong Jiangshan can gain relatively stable material supply, especially paraformaldehyde from Nantong Jiangtian.

Ranking No.2 among Chinese glyphosate manufacturers with technical capacity of 70,000t/a, Nantong Jiangshan mainly adopts AEA route technology to run 30,000t/a technical capacity. As main material in AEA route production, the paraformaldehyde produced by Nantong Jiangtian is mainly supplied

to Nantong Jiangshan. However, in the past one and a half years, Nantong Jiangshan’s performance didn’t show a sense of optimism. Only in the first half of 2010, the company experienced large deficit, with total revenue and net profit dropping by 10.4% and 490.7% year on year to approximately USD161 million and USD-0.81 million respectively.

Although the global economy has been gradually recovering after 2009, Nantong Jiangshan’s weak business

the company’s product structure is still simple.

What’s more, Lier Chemical with herbicide export as main business also needs a ready-made sales network in China to explore domestic market.

At present, Jiangsu Kuaida has more than 60 kinds of pesticide products which almost cover the whole domestic pesticide market with nice reputation. Especially, Jiangsu Kuaida’s herbicide business owns advantages compared

with other domestic agrochemical companies, and the market share of its sulfonylurea herbicide products ranks No.1 in China.

As phosgene manufacturer approved by Chinese government, Jiangsu Kuaida’s performance witnessed rise gradually, even though it was not as nice as expected in 2009 with a 19.59% drop in net profit year on year, due to the global financial crisis.

The reorganization course:1) 2010.3.26 Lier Chemical applied for stock trade suspension for the purchase of Jiangsu Kuaida;2) 2010.4.1 Lier Chemical’s broad meeting passed the purchasing proposal;3) 2010.4.21 Jiangsu Kuaida’s broad meeting agreed to the purchase;4) 2010.4.26 & 2010.6.3 Lier Chemical detailed the plan for the purchase;5) 2010.6.22 Lier Chemical held general stockholders’ meeting and passed relative purchasing plans;6) 2010.11.2 The purchase passed the environmental acceptance check from Environmental Protection Department of Jiangsu Province;7) 2010.12.28 CSRC approved Lier Chemical to purchaseJiangsu Kuaida.

(Relative news about Lier Chemical’s acquisition of Jiangsu Kuaida is provided in issue 1005 and 1010 of

Herbicides China News)

Figure 8: Share structure of Nantong Jiangshan, Nantong Jiangtian and Nantong Industries, 2011


Nantong Jiangshan Agrochemical & Chemicals Co., Ltd.

Nantong Jiangtian Chemicals Co., Ltd.

Nantong Industries Holding Group Co., Ltd.

28.45%

22.23%

19.65%



performance is estimated to continue in the second half of 2010. One possible reason why Nantong Jiangsu sold some Nantong Jiangtian’s share is that it wants to alleviate its deficit. But this conjecture hasn't been confirmed by

Nantong Jiangshan. Nantong Industries, a state-owned investment company, focuses on investment business covering chemicals, spinning, light industry, pharmaceuticals, machinery, etc.

Henan Yingtai constructs acetochlor quietly

One latest intelligence shows that Henan Yingtai Chemical & Industry Co., Ltd. (Henan Yingtai)'s

10,000t/a acetochlor technical production line is on the agenda.

CCM International gained the intelligence about 10,000t/a acetochlor production line on the local official website of Puyang City, Henan Province, as all the constructions in 2010 are listed by local government on that wetsite. And according to the latest report on Dec. 15th 2010, all workshops and some assorted facilities are being constructed, implying that main construction of Henan Yingtai’s acetochlor production line has not been established.

But CCM International’s further investigation into Henan Yingtai’s acetochlor production line was rejected due to secrecy obligation. "I don’t know anything about the 10,000t/a acetochlor production line." Said several insiders of Henan Yingtai.

Some relative reports also released that Henan Yingtai is undergoing this acetochlor production line. And it’s estimated that the main acetochlor production line could be launched in the first quarter of 2011.

‘Actually, Henan Yingtai has no acetochlor products at present.’ A saleswoman of Henan Yingtai released honestly. However, on the base of CCM International's investigation, it could be confirmed that this production line is under construction now.

As to Henan Yingtai’s other products, Henan Yingtai is engaged in production and sales of aniline chemicals primarily. If 10,000t/a acetochlor production line is launched, acetochlor product will be the first pesticide of Henan Yingtai.

Meanwhile, Henan Yingtai will also be in the leading rank of acetochlor manufacturers in China with the planned 10,000t/a production line. Currently, over five acetochlor manufacturers' capacities succeed 10,000t/a in China. As the most popular herbicide in the world, acetochlor has grasped largest market share among selective herbicides applied in China in the past many years. Thanks to its wide weed control spectrum and low application cost, acetochlor is usually used for pre-emergent control of annual weeds and some broadleaf weeds in the fields of rice, corn, cotton, peanut, soybean, etc. And the peasants use acetochlor to mix with herbicides efficient in broadleaf weed control, such as bensulfuron-methyl and prometryn.

With depressed herbicide market caused by the financial crisis, acetochlor, like popular herbicides such as glyphosate, also experienced a hard period in 2010. The average price of acetochlor, which fluctuated around USD2,789/t, is still lower than the price level in 2008 (Herbicide China News 1008: Low acetochlor price to continue).

Fengshan Group consolidates leading trifluralin position

In a bid to share a slice of cake from Chinese herbicide industry,

Fengshan Group also joins into the group who usually expand their dominant production to consolidate competitiveness. As No.1 trifluralin manufacturer with capacity of 3,000t/a in China, Fengshan Group is constructing another new trifluralin production line with capacity of 5,000t/a now.

Prodiamine, one of dinitroaniline herbicides including trifluralin, is also

being pursued by Fengshan Group at the same time. According to Fengshan Group’s EIA announcement on Nov. 24th 2010, Fengshan Group plans to launch these two production lines of 5,000t/a trifluralin and 300t/a prodiamine in Dafeng Port Economic Zone.

According to its original plan the two production lines with investment of USD7.5 million are expected to be launched in H2 2011. "But there are still too much works because the whole

project was set out not long before." Said Mr. Hu who is in charge of the project from Fengshan Group. And he explained that the EIA application has not been approved by local government and the whole project is under civil construction currently.

After trifluralin production line launched, Fengshan Group’s trifluralin capacity will reach 8,000t/a and keep top position in China. And the prodiamine production can make use of trifluralin production line as the



Dicamba attracts pursuers’ interest

production technology of prodiamine is similar to that trifluralin production.

In fact, two production lines were arranged to be launched around the period when Chinese herbicide market booms again in 2011, which means that it is possible for Fengshan Group to enjoy the recovering global environment in the future with dominant business. Primarily exported to overseas market, trifluralin technical (grade: 96%) was firstly introduced into China by Sipcam S.p.a, Italy, in 1987. As of Jan. 2011, Fengshan has achieved two

trifluralin registrations, namely 96% technical (PD20050165) and 48% EC (PD20060091). On the whole, total 142 trifluralin registrations are achieved by 68 manufacturers in China.

Generally, trifluralin is mainly used for selectively pre-emergence control of annual grassy weeds and some broadleaf weeds in fields of soybean, cotton, rape and so forth. In China, trifluralin is mainly used to control weeds in cotton fields with average AI dosage of 1000g per hectare.

According to a salesman of Fengshan

Group, current price of trifluralin technical floats around USD4,600/t. And CCM International thinks that friendly price of trifluralin will make it enjoy nice market in the future. Located in Dafeng City of Jiangsu, Fengshan Group is a top pesticide producer in China and is engaged in research, production and marketing of agrochemical products. With pesticide technical capacity of 30,000t/a, Fengshan Group’s herbicides products include trifluralin, nicosulfuron, quizalofop-P-ethyl, etc.

■ Market Analysis

With dicamba-tolerant crops pushed by global top

agrochemical companies such as Monsanto and BASF, dicamba draws more pursuers' attention in global GM innovation wave.

‘Several projects across platforms and crops designed to improve farmers’ on-farm productivity and profitability advanced phases today as part of Monsanto Company’s (NYSE: MON) annual pipeline update.

The company highlighted, in particular, key projects in its yield and stress pipeline collaboration with Germany-based BASF Plant Science, which last year was expanded to include wheat. Yield and stress projects advancing phases this year include Nitrogen-Utilization Corn, Second-Generation Higher-Yielding Soybeans and Higher-Yielding/Stress Tolerant Wheat.’

One news about Monsanto’s dynamics was reported by MultiVu on Jan. 6th 2011. And some words about Stress Tolerant drew CCM International’s attention. As mentioned in the news, the Monsanto and BASF collaboration had developed several stress tolerant crops during former cooperation, namely glyphosate/dicamba-tolerant crops.

Although dicamba didn’t witness golden period in the past years like glyphosate in 2008, dicamba-tolerant crops are developed one by one in the world, making global limelight focus on dicamba gradually. It’s reasonable to think that dicamba may be the second glyphosate in the future.

But, actually, dicamba is not well developing in domestic market. More expensive than general wheat herbicides, dicamba is primarily exported to overseas market. Only in H1 2010, over 30% of annual full-load output was exported with average price of USD12,000t/a. Generally speaking, peak export season of dicamba is from Oct. to next March in China. And Chinese dicamba manufacturers don't stop production in the whole year except June and July, the time for inspection and maintenance. With high technology barriers, dicamba also faces stricter requirement on environmental protection in China, so only three dicamba technical manufacturers exist in China at present, namely Zhejiang Shenghua Biok Biology Co., Ltd., Youth Chemical Co., Ltd. and Jiangsu Shenghua Pesticide Co., Ltd. (Jiangsu Shenghua) with total capacity of 3,500t/a.

What’s more, Jiangsu Shenghua had suspended dicamba production due to complex factors including pollution problem (Herbicide China News 1012: Jiangsu Shenghua suspends dicamba plant). It means that dicamba output in China reduces further and dicamba pursuers with stronger competitiveness can take a larger market share.

Although it’s not sure whether dicamba-tolerant crops could be approved to enter China, dicamba-tolerant crops developed by GM technology will drive dicamba to flourish further all over the world. In addition, coupled with technology innovation, it’s hopeful to lower unfriendly price of dicamba in China.



Metolachlor threatens acetochlor in China

As a small breed amide herbicide in China, metolachlor owns

predominant advantages over acetochlor and may substitute acetochlor in the future. But acetochlor will still dominate domestic market in the short term with huge market share of about 10%.

With the pesticide industry taking steps toward environmentally friendly development, acetochlor, the most popular amide herbicide in China, is encountering large challenge from other competitors and stricter requirements on environmental protection after it has been applied for about 30 years. As one competitor of acetochlor, metolachlor is easily listed into potential substitute with higher safety and weaker resistance. Metolachlor, an amide herbicide which is primarily applied to controlling annual gramineae weeds in fields of soybean, corn, peanut, maize and paddy, ranks No. 4 among popular amide herbicides all over the world.

Firstly registered by Syngenta Corporation in 1988 as metolachlor 72% EC with the trade name of Dual, metolachlor attracted domestic agrochemical pursuers’ interest gradually in subsequent twenty years. In 1998, Hangzhou Qingfeng Agrochemical Co., Ltd. (Zhejiang

Qingfeng) registered metolachlor technical firstly in China.

At present, over 10 technical manufacturers is actively producing metolachlor in China with total capacity of more than 20,000t/a. According to the authoritative statistics, in China, metolachlor achieved sales value of USD5 million in 2009 with market share of 0.4%. Comparatively, the application dosage of metolachlor and acetochlor is almost the same but control spectrums are different. Apparently, metolachlor could control more varieties of weeds.

What's more, relative research indicates that metolachlor is safer and more environmentally friendly than acetochlor with the same dosage. A research about soil adsorbability releases that the residue of acetochlor resided is more easily left in soil than that of metolachlor.

Compared with consumption volume and period of acetochlor applied in China, less metolachlor is used by Chinese peasants. It means that greater weed resistance to acetochlor makes it less effective than metolachlor. In addition, having been applied for a long time, the residual problem of acetochlor is severer than that of metolachlor, inhibiting acetochlor's development in domestic market.

Although acetochlor is being threatened by many competitors including metolachlor in China, its stable consumption groups and low price promise will guarantee its position of top popular amide herbicide in the long term.

Compared with metolachlor average price of USD3,800/t, acetochlor is cheaper, with the price fluctuating around USD2,800/t in 2010. As for lots of consumers in China, acetochlor with similar effect and lower price is more adaptable, though its environmental pollution is higher and phytotoxicity is greater. On the whole, acetochlor is facing greater challenge from metolachlor, but it still take metolachlor a long time to be a substitute of acetochlor completely.

Table 2: Application dosage of metolachlor and acetochlor on soybean and corn, 2010

Crop field

metolachlor 72% EC (g/ha. AI)

acetochlor 90% EC (g/ha. AI)

Soybean 5~9 3.5~4.4

Corn 6~12 6~7.2


Figure 9: Price trend of acetochlor and metolachlor in China, 2010


2,600

2,800

3,000

3,200

3,400

3,600

3,800

4,000

Jan. Feb. March April May June July Aug. Sept. Oct. Nov. Dec.

Mo

nth

ly a

vera

ge

pri

ce: U

SD

/t

Acetochlor (92%) Metolachlor (97%)



Hubei Huida suspends bispyribac-sodium production

■ Supply & Demand

Anhui Fengle expands tribenuron-methyl production

AnhuiFengle Agrochemical Co., Ltd. (Anhui Fengle), the

subsidiary of Fengle Seed Co., Ltd, is expanding tribenuron-methyl production currently by constructing a new 300t/a technical production line. Although the 300t/a tribenuron-methyl production line is still under construction at present, Anhui Fengle is confident in the future sales of tribenuron-methyl products.

"Tribenuron-methyl is Anhui Fengle’s prime product," Sales Manager surnamed Lin introduced, "and we own export qualification of tribenuron-methyl." According to the introduction, Anhui Fengle’s tribenuron-methyl is usually exported to Europe rather than South Asia.

Because tribenuron-methyl is generally applied in wheat field to control annual and perennial broadleaf weeds, domestic sales of Anhui Fengle’s tribenuron-methyl is concentrated in North China.

Although the company’s tribenuron-methyl output is only 250t/a in 2009, a half of its total capacity, resulted from the financial crisis, Anhui Fengle is so optimistic about future market of tribenuron-methyl that it is

implementing the 300t/a expanding plan. Having been applied for years in China, tribenuron-methyl's advantages are expected by most of industrial experts and pursuers. Tribenuron-methyl is not only safe but also very active to succeeded crops like cotton, soybean, corn, etc. Generally, only 10~20 gram tribenuron-methyl can take effect on controlling weeds in one hectare field.

As of Jan. 2011, there are 233 active tribenuron-methyl registrations in China. Among them, the number of technical registrations exceeds 20. With herbicide industry in China recovering completely and developing further in 2011, tribenuron market will witness nice prospect. Meanwhile, Anhui Fengle could grasp the chance with tribenuron-methyl capacity of 800t/a after present 300t/a expanding capacity launched.

But it needs some time to finish the construction of new production line. According to one insider of Anhui Fengle, EIA of the production line was just approved recently and next step

is to trial the new production line with small output in May 2011.

On Dec. 17th 2010, one EIA announcement about Anhui Fengle’s 300t/a tribenuron-methyl production line was issued on official website of Hefei Environmental Protection Bureau. As written in the bulletin, the new production line is located in Hefei Circular Economy Park with total investment of USD3 million.

Up to now, Anhui Fengle has achieved three tribenuron-methyl registrations including 92% technical (PD20070552), 75% WG (PD20070642) and 10% WP (PD20081290). What’s more, tribenuron-methyl 10% WP is well sold in home market and 92% technical is quoted at USD22,000/t by Anhui Fengle. Anhui Fengle is a subsidiary of listed Hefei Fengle Seed Co., Ltd., which is mainly engaged in crop seeds and agrochemical businesses. And Anhui Fengle’s agro-chemical products are the second largest business of Fengle Seed.

Hubei Huida Technology Development Company

(Hubei Huida)’s 200t/a bispyribac-sodiumproduction line has suspended operation recently even though it has been launched for only several months. It's estimated that the production will be resumed after Chinese Spring Festival in Feb.2011, the most important traditional festival in China, and till then large-scale production will be achieved instead of the small output before. According to CCM International’s investigation, Hubei Huida has no bispyribac-sodium in stock at present. And Hubei Huaida's suspension of bispyribac-sodium

production is confirmed by Beijing Insight Finechem Co., Ltd. (Beijing IFC), the parent company of Hubei Huida.

"The bispyribac-sodium production line will not be resumed until Chinese Spring Festival,"said the Sales Manager surnamed Guo of Beijing IFC, "and bispyribac-sodium 95% technical is the main variety produced by this 200t/a product line." Of course some formulation products will also be produced to meet customers' demand.

But Manager Guo refused to disclose the prices of bispyribac-sodium

products because it has no inventory. As introduced by Manager Guo, the output of this bispyribac-sodium production line was still small though the 200t/a production line had been launched for several months.

After Chinese Spring Festival, Hubei Huida will heighten operating rate of the bispyribac-sodium production line as planned. Although Manager Guo didn't explain, it could be concluded that the reason why Hubei Huida adapted low operating rate after the production line launched is that Hubei Huida takes a cautious attitude towards bispyribac-sodium.



Actually, it's the first time for Hubei Huida to produce bispyribac-sodium. Hence, it produces bispyribac-sodium with caution and plans to export its bispyribac-sodium for overseas mature market. As for domestic agrochemical market, bispyribac-sodium developed by Kumiai Chemical Industry Co., Ltd. is considered to be a new herbicide

and it’s also believed to have promising market in the future. Up to now, only three companies have achieved bispyribac-sodium technical registration in China, not including Hubei Huida. (Please review Herbicides China News 1010)

Absorbed by leaves or roots of plants, bispyribac-sodium has excellent effect on controlling grasses, sedge and broad-leaved weeds, especially

barnyard grass. It’s reported that barnyard grass in the first to seventh growth period could be controlled effectively by bispyribac-sodium with dosage of only 15 ~ 45g per hectare. Hubei Huida, located in Jianglin County, Jingzhou City, Hubei Province, is a chemical manufacturer mainly engaged in production of herbicide and plant growth regulator.

All self-produced metamitron are exported in China

"We just accept foreign orders." Said one salesman

of Hebei Wanquan Hongyu Chemical Co., Ltd. (Hubei Wanquan), the only one metamitron manufacturer in China now with capacity of 1,500t/a. According to the salesman's introduction, all Hebei Wanquan’s metamitron products are exported to West Europe, North America and North Africa.

By looking up metamitron registration record in China, CCM International found that Rosi Chemical Co., Ltd. (Rosi Chemical) also has achieved metamitron registration. But, in fact, Rosi Chemical hasn’t begun to produce metamitron.

"Rosi Chemical has developed metamitron production technology not long before," one insider of Rosi Chemical explained, " it still needs some time to start formal metamitron production with large output."

It means that metamitron market in domestic market is still blank at present. Although CCM International tried to find the reason why Hebei Wanquan’s metamitron is only for export, Hebei Wanquan refused to answer our confusion due to secrecy obligation.

"We have regular clients purchasing metamitron products." The salesman of Hebei Wanquan told us. It’s revealed that Hebei Wanquan’s metamitron products are more popular in overseas market, thus, the orders have been booked till 2011 Chinese Spring Festival.

Generally, Hebei Wanquan’s annual output could exceed 1,000t/a. In terms of Rosi Chemical’s metamitron, it is likely to be sold in domestic market in the future. But relative information involving certain production line was unknown at present.

Belonging to triazine herbicides, metamitron is developed by Bayer CropScience LLC. in 1975. As an inhibitor in photosynthesis process, metamitron can be easily absorbed

by plant roots and is usually applied to pre- and post-emergent control of weeds in sugar beet field throughout the growing period of weeds with high activity, low toxicity and low residue.

Hebei Wanquan, founded in 1997, is a private company who is mainly engaged in production and sales of metamitron and clethodim. As a export-oriented enterprise, Hebei Wanquan’s clients centralize in Europe, America, Southeast Asia, etc.

Figure 10: Chemical structure of metamitron

Table 3: Registration of metamitron in China, as of Jan. 2011

Registration number

ContentExpiration

timeManufacturer

LS20080072 70% WG 2012.01.04Hebei Wanquan Hongyu Chemical Co.,

Ltd.

LS20080074 98% technical 2012.01.04Hebei Wanquan Hongyu Chemical Co.,

Ltd.

LS20091019 98% technical 2011.04.13 Rosi Chemical Co., Ltd.




■ Price Analysis- Price Review

Good Harvest-Weien to pursue 2,4-D

Recently, Jiangsu Good Harvest-Weien Agro Chemical Co.,

Ltd. (Good Harvest-Weien) starts to pursue 2,4-D by constructing a 10,000t/a 2,4-D production line. Although the 2,4-D production line has not been installed, Good Harvest-Weien’s behavior implies domestic agrochemical manufacturers’ increasing attention to 2,4-D.

On Dec. 3rd 2010, one EIA bulletin about Good Harvest-Weien’s 2,4-D production line was issued on Nantong Environmental Protection Bureau’s official website, indicating that the construction gained local government’s agreement to be initiated. Accompany with 2,4-D production line, 500t/a MCPA production line will also be set out meanwhile.

According to the bulletin, these two production lines will be invested with USD10.9 million totally. Located in Good Harvest-Weien’s current address, Bingjiang Fine Chemical Park, Qidong City in Jiangsu Province, and the 10,000t/a 2,4-D production

will take use of existing assorted facilities, such as waste treatment.

Now the whole construction still stay in primary phase so that Good Harvest-Weien has no 2,4-D products yet. Actually, it’s the first time for Good Harvest-Weien to explore 2,4-D business. After formal production achieved, Good Harvest-Weien’s 2,4-D business will be centralized in domestic market at first.

Even though Good Harvest-Weien will not make great efforts to explore overseas 2,4-D market in the short term, the construction reflects the company’s ambition to pursue this hot product. The fast development of 2,4-D-tolertant crops has been raising overseas 2,4-D manufacturers' enthusiasm. Accompany with global developing trend of herbicide industry, domestic agrochemical manufacturers have also begun to pursue some herbicides related to GM technology

in recent years, including glyphosate, dicamba, 2,4-D.

Partially pushed by Monsanto’s glyphosate-tolerant crops, glyphosate witnessed a flourish period in 2008. Similar to glyphosate, 2,4-D may meet a booming market after Dow’s 2,4-D-tolerant crops popularized gradually, though GM crops have not been accepted completely by most countries in the world now.

Hence, 2,4-D is drawing global agrochemical manufacturers' attention . As a domestic herbicide pursuer, Good Harvest-Weien’s construction is in the contemplation. Good Harvest-Weien, located in Qidong City, Jiangsu Province, is a joint stock company engaged in the production and sales of insecticides and herbicides. And herbicides produced in Good Harvest include glyphosate, phenmedipham and desmedipham.

Monthly market prices of main crops in China, Jan. 2011

Crop

Jan. 11 Dec. 10 Jan. 10 2009

USD/t RMB/t USD/t RMB/t USD/t RMB/tPlanting area

(103 ha.)

Chinese output

(103 tonnes)

Indica rice 349 2,301 480 3,200 409 2,793 29,680 195,800

Japonica rice 423 2,794 581 3,870 504 3,440 - -

Wheat 316 2,084 307 2,045 295 2,018 24,210 114,950

Rapeseed 591 3,900 591 3,941 603 4,120 7,200 13,500

Corn 297 1,962 291 1,940 260 1,776 30,460 163,000

Soybean (oil) 561 3,700 603 4,020 540 3,690 8,800 14,500

Soybean (food) 606 4,000 653 4,350 586 4,000 - -

Peanut 1,227 8,100 1,126 7,500 1,245 8,500 4,233 13,607

Broomcorn 308 2,030 339 2,260 310 2,120 1,016 3,640




Monthly ex-factory prices of key raw materials, Jan. 2011

Raw material/intermediatesJan. 11 Dec. 10 Jan. 10

USD/t RMB/t USD/t RMB/t USD/t RMB/t

Phosphorus trichloride (99%) 788 5,200 870 5,800 857 5,850

Glycine (98%) 1,894 12,500 1,951 13,000 1,757 12,000

Iminodiacetonitrile (92%) 1,667 11,000 1,876 12,500 1,831 12,500

Chloroacetic chloride (99%) 1,106 7,300 1,246 8,300 1,245 8,500

Pyridine (99.9%) 4,546 30,000 4,502 30,000 4,613 31,500

Cyanuric chloride (> 99.3%) 1,667 11,000 1,876 12,500 1,933 13,200

Paraformaldehyde (95%) 727 4,800 - - - -

Dimethylamine (40%) 576 3,800 - - - -

Isopropylamine (99%) 2,030 13,400 - - - -


Monthly ex-factory prices of main herbicides, Jan. 2011

TechnicalJan. 11 Dec. 10 Jan. 10

USD/t RMB/t USD/t RMB/t USD/t RMB/t

Glyphosate (95%) 3,437 22,680 3,479 23,180 3,615 24,680

Paraquat (42%) 2,300 15,180 2,203 14,680 2,223 15,180

Acetochlor (92%) 2,906 19,180 2,849 18,980 2,780 18,980

Atrazine (97%) 2,830 18,680 3,029 20,180 2,956 20,180

Tribenuron- methyl (95%) 17,377 114,680 18,712 124,680 18,260 124,680

Metolachlor (97%) 4,118 27,180 3,854 25,680 3,761 25,680

Butachlor (92%) 3,361 22,180 3,329 22,180 3,029 20,680

Pendimethalin (95%) 7,528 49,680 7,606 50,680 7,276 49,680

Trifluralin (95%) 4,952 32,680 3,854 25,680 3,541 24,180

Quizalofop- P-ethyl (95%) 24,195 159,680 23,965 159,680 22,361 152,680

Fenoxaprop- P-ethyl (95%) 33,286 219,680 32,970 219,680 30,709 209,680

Oxyfluorfen (97%) 19,346 127,680 19,163 127,680 18,993 129,680

Nicosulfuron (95%) 31,771 209,680 - - - -

Bensulfuron-methyl (96%) 20,862 137,680 - - - -

Fluroxypyr (96%) 22,680 149,680 - - - -

Clomazone (95%) 15,407 101,680 - - - -

Fomesafen (95%) 14,346 94,680 - - - -




Monthly Shanghai port prices and FOB Shanghai of main herbicides, Jan. 2011

Technical

Shanghai Port Price FOB (Shanghai)

Jan. 11 Dec. 10 Jan. 10 Jan. 11 Dec. 10

USD/t RMB/t USD/t RMB/t USD/t RMB/t USD/t USD/t

Glyphosate (95%) 3,485 23,000 3,527 23,500 3,661 25,000 3,573 3,617

Paraquat (42%) 2,349 15,500 2,251 15,000 2,270 15,500 2,392 2,296

Acetochlor (92%) 2,955 19,500 2,897 19,300 2,827 19,300 2,983 2,925

Atrazine (97%) 2,879 19,000 3,077 20,500 3,002 20,500 2,909 3,101

Tribenuron- methyl (95%) 17,425 115,000 18,760 125,000 18,307 125,000 17,100 18,402

Metolachlor (97%) 4,167 27,500 3,902 26,000 3,808 26,000 4,166 3,906

Butachlor (92%) 3,409 22,500 3,377 22,500 3,076 21,000 3,426 3,394

Pendimethalin (95%) 7,576 50,000 7,654 51,000 7,323 50,000 7,492 7,567

Trifluralin (95%) 5,000 33,000 3,902 26,000 3,588 24,500 4,979 3,906

Quizalofop- P-ethyl (95%) 24,244 160,000 24,013 160,000 22,408 153,000 23,752 23,526

Fenoxaprop- P-ethyl (95%) 33,335 220,000 33,018 220,000 30,756 210,000 32,621 32,311

Oxyfluorfen (97%) 19,395 128,000 19,211 128,000 19,040 130,000 19,022 18,841

Nicosulfuron (95%) 31,820 210,000 - - - - 31,143 -

Bensulfuron-methyl (96%) 20,910 138,000 - - - - 20,500 -

Fluroxypyr (96%) 22,728 150,000 - - - - 22,274 -

Clomazone (95%) 15,455 102,000 - - - - 15,178 -

Fomesafen (95%) 14,395 95,000 - - - - 14,143 -

Note: Shanghai port price = ex-factory price plus transport fee from production plant to Shanghai portShanghai FOB price = port price + handling and THC + trading companies' profit – export rebateSource: CCM International

- Pricing

Overview of Chinese glyphosate price in 2010

Similar to that in 2009, the prices of Chinese glyphosate products

in 2010 also witnessed stagnant situation. However, with global economy recovering gradually, glyphosate prices witnessed slight increase at the end of 2010.

As usual, the whole situation of glyphosate prices didn’t change too much in 2010. With one drop during Jan. to May and one rise during June to Dec. respectively, average prices of glyphosate products still kept at a low level. Take glyphosate technical for example, top price in Jan. 2010 reached only USD3,660/t, just USD199/t over the valley price in Dec. 2008.

Figure 11: Ex-factory price trend of glyphosate products in China, 2010


0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

Jan. Feb. March April May June July Aug. Sept. Oct. Nov. Dec.

Mon

thly

ave

rage

pric

e: U

SD

/t

10% SL 41% IPA 62% IPA 50% WP 75.7%WP Tech.

■ News in Brief



Chinese herbicide technical output in-creases in Nov. 2010

Current statistics indicate that domestic herbicide technical output in Nov. 2010 increased by 20.9% year

on year to 99,000 tonnes, accumulatively reaching 0.99 million tonnes in 2010.

UN not to ask anti-dumping tax against Chinese glyphosate in 2011

EU will not resume anti-dumping tax against Chinese glyphosate in 2011 after the anti-dumping application

cancelled by the European Glyphosate Association in Sept. 2010. Before the cancellation, Chinese glyphosate manufacturers had to pay 29.9% anti-dumping tax to EU for Chinese glyphosate exported to EU.

Fujian Sannong’s relocation

On Nov. 4th 2010, Fujian Sannong Group Co., Ltd. issued a bulletin that the company had gained

partial compensation of about USD49 million from local government due to the whole relocation into Huangsha Chemical Industry Park in Sanming City. According to the bulletin, the whole relocation will be finished at the beginning of 2011.

New herbicide products in 2011

It's reported from Agrow that ten new herbicide products are expected in 2011, they are listed as below:

1. Callisto Xtra® (Mixed formulation including mesotrione and atrazine) from Syngenta, applied in corn field;2. Peak® (Prosulfuron mainly) from Syngenta, corn field;3. TripleFlex® (Acetochlor, flumetsulam, and clopyralid) from Monsanto, corn field;4. Warrant® (Acetochlor) from Monsanto, soybean and corn;5. Kixor® (Pyribenzoxim mainly) from BASF, corn, soybean and wheat;6. TripleFlex® (Acetochlor, flumetsulam, and clopyralid) from Monsanto, corn field;7. Cleansweep D® & Cleansweep M® (Buctril and 2,4-D & Starane and 2,4-D) from Nufarm, wheat;8. Huskie® (Buctril and pyrasulfotole) from Bayer, wheat;9. PowerFlex® (Pyroxsulam mainly) from Dow, wheat;10. Pulsar® (Fluroxypyr and dicamba) from Syngenta, wheat.

Chinachem to purchase MA Industries

According to MA Industry's official report, Chinachem and Koor Industries, parent company of MA

Industries, the leading generic pesticide company in the world, reached agreement that Chinachem would purchase 60% share of MA Industries with projected capital of USD1.44 billion. The formal contract was planned to be finished in H1 2011.

What’s more, the changes in prices of glyphosate products in 2010 are still caused by supply/demand relationship primarily. Due to alleviation supply of energy and material, glyphosate prices witnessed continual drop after winter. And glyphosate technical price didn’t decrease to valley of USD2,828/t until May 2010.

Thanks to the peak selling season (Feb. - May) and coming winter, coupled with the whole recovering environment, glyphosate prices started to rebound after the valley price. Actually, global pesticide market began meeting recovery in 2010. The gradually increasing overseas demand, the abolishment of glyphosate export rebate and rising prices of materials also drove glyphosate prices to

rebound.

Little different from other varieties of glyphosate products, glyphosate 10% SL price has been increasing slightly in 2010, with the increase floating in the range of USD500/t. In Dec. 2010, the price of glyphosate10% SL approached top of USD670/t.

In addition, according to Chinese government's regulation considering pollution problem, that is, glyphosate 10% SL pollute environment more serious than glyphosate 41% IPA, and glyphosate 10% SL will be prohibited to produce in China's herbicide market from Jan. 2011. Hence, glyphosate 41% IPA might substitute glyphosate 10% SL to be the Chinese popular formulation of glyphosate in the

future.

Compared with that of glyphosate 10% SL, the price of glyphosate 41% IPA is higher. In 2010, the average price of glyphosate 41% IPA fluctuated around USD1,700/t. Although domestic glyphosate overcapacity still exists at present, the whole recovering environment, increasing material price and swelling overseas demand are driving glyphosate prices to recover from gloom casted by the financial crisis in 2009. Thus, it’s predicted that the price level of glyphosate in 2011 will be higher than that in 2010.

CCM International Limited

17th Floor, Huihua Commercial & Trade Building, No.80 Xianlie Zhong Road

Guangzhou, 510070, P.R.China

Tel: +86-20-37616606

Fax: +86-20-37616968

E-mail: [email protected]

Website: www.cnchemicals.com

Journalist:

Bobby Liu

Editor:

Micheal Li

Editor in Chief:

Ann Liang

Publisher:

Zhonghui Wu

Date post:	21-Mar-2016
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