Guizhou moving up phosphate value chain

A State-owned enterprise in Guizhou is on track to transform the province into a producer of high-end refined chemical products to achieve more added value and presence in the global market.

State-owned Guizhou Phosphate & Chemical (Group) Co Ltd announced that several phosphate processing projects have started operation in the province this year, with a total investment of about 2 billion yuan ($282.7 million).

The projects include a purified phosphoric acid (PPA) project with an annual output of 400,000 metric tons, two anhydrous hydrogen fluoride projects with an annual output of 30,000 tons each, a gypsum powder project for building materials with an annual output of 1.2 million tons, a 30-million square meter paperless gypsum board project and a major building materials and industrial equipment project.

The projects, which also feature environmentally friendly production, are expected to bring in over 3.5 billion yuan in industrial output value to the province each year upon completion, according to the company.

Launching these projects marks a great step in the company's transformation to a high-end producer, said Chairman He Guangliang, adding that the projects will intensify Guizhou Phosphate's earning power due to more growth drivers as well as boost the SOE's structural reform.

"The group's structural adjustment on revenue sources and production procedures－and variation of products－helps it tackle overcapacity of phosphate fertilizer (on which the group's income relies heavily) and hedge risks from continuously shrinking market demand," He said.

According to the group, the PPA project will further consolidate the group's position as a leading global supplier for phosphoric acid and boost development of related industries like high-end refined phosphate products.

The group also said one of the two anhydrous hydrogen fluoride projects is expected to be finished by the end of April.

The group plans to build itself into one of the world's biggest and most competitive fluoride-related resource suppliers by expanding its global annual production capacity of anhydrous hydrogen fluoride to 500,000 tons in the short future.

An Fengming, deputy director of State-owned Assets Supervision and Administration Commission of Guizhou, said the new projects showed Guizhou Phosphate & Chemical's development in related technologies and filled a gap in the development of refined phosphorous products.

Tang Xinglun, vice-mayor of Guiyang, said concerted efforts from various departments will be made to guarantee a good production environment for the projects.

Tang said efforts will be made to facilitate a more efficient government administrative service system, and ensure that water, power and gas are in adequate supply.

Guizhou Phosphate & Chemical was founded in June by the local government. It has stakes in some major local phosphate and chemical firms, including Wengfu Group and Guizhou Kailin Group.

Zhao Yandi in Guiyang contributed to this story.