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CCM Data & Primary Intelligence

Glycine Survey in China - The Third Edition November 2010

Researched & Prepared by:

Guangzhou CCM Information Science & Technology Co., Ltd. Guangzhou, P. R. China

Copyright by Guangzhou CCM Information Science & Technology Co., Ltd. (P. R. China) Any publication, distribution or copying of the content in this report is prohibited. Website: http://www.cnchemicals.com Tel: +86-20-3761 6606 Fax: +86-20-3761 6968 Email: econtact@cnchemicals.com

Website: http://www.cnchemicals.com Tel: +86-20-3761 6606

Email: econtact@cnchemicals.com Fax: +86-20-3761 6968


CCM Data & Primary Intelligence Description: Glycine, including tech-grade, feed-grade, food-grade, pharmaceutical-grade, is widely used as raw materials for CMC, agrochemicals and surfactant. China is not only a major production base of glycine, but also a large consumer. Glycine has experienced strong growth momentum over the past few years especially after 2007, seeing a surge in demand at home, which pushes up capacity expansion and output increase. China’s glycine capacity is expected to reach 370,700t/a in 2010, and its output was over 150,000 tonnes in 2009. Besides production situation, this report also provides answers to the key issues in Chinese glycine industry as follows. (1) Chongqing Sanxia Yingli Chemical Company is the first and the only company adopting natural gas as starting raw material to produce glycine in China, and it has suffered a lot in its glycine business notably from unstable production, immature technology etc. What’s its current situation and how it will get out of the predicament to seek further development? (2) Glycine industry has encountered poor profit and low price in 2009, due to the sluggish glyphosate. What is the development trend in 2010 and even to 2014? How about the industry integration of glycine and its upstream products? (3) At present, in what field glycine is applied in China? Will other potential end-use segments be developed? You can also figure out the breakdown of drivers and barriers for Chinese glycine industry, as well as the forecast on glycine development in China in 2009~2013.

Main content: No. Content Chapter One Introduction Research objectives Reasons for doing this research Scope of report Methodology Information sources Chapter Two Executive summary Chapter Overview of glycine in China Three III-1 Introduction III-2 Classification of glycine Website: http://www.cnchemicals.com Tel: +86-20-3761 6606

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CCM Data & Primary Intelligence III-3 III-4 III-4.1 III-4.2 III-4.3 III-4.4 III-4.5 III-5 III-6 Chapter Four IV-1 IV-1.1 IV-1.2 IV-1.3 IV-2 IV-2.1 IV-2.2 IV-3 Chapter Five V-1 V-2 V-2.1 V-2.2 V-2.3 V-2.4 V-3 V-3.1 V-3.2 V-4 V-5 Appendix VI-1 … VI-20

Driving forces for the industry Technology progress of glycine Brief introduction of chloroactic acid ammonolysis process Brief introduction of Strecker process Brief introduction of hydantion process Brief introduction of Sanxia Yingli’s natural gas-HCN process Development trend of glycine technology Regulatory issues Industry players Market summary and assumption Historical evolution of glycine markets Price Export Markets by grade Predicted market value Markets by grade Pricing summary Market challenges Industry structure and competitive analysis Market segmentation Brief introduction to major end-use segments Glyphosate Food Feed Pharmaceutical Industry concentration of glycine materials Urotropine Chloroacetic acid Industry concentration of glycine companies Market trends Glycine suppliers Hebei Donghua Chemical Group … Baoding Mantong Fine Chemistry Co., Ltd.

6 7 7 8 9 10 11 11 13 17 17 17 19 28 29 29 30 31 33 33 33 33 37 37 38 39 39 40 42 44 45 45 72 74

Executive summary: Four grades of glycine are produced in China, namely tech-grade, feed-grade, food-grade and pharmaceutical-grade. Among them, tech-grade glycine has been dominating the whole glycine market, accounting for XX% of the national glycine output in 2009. Chinese glycine industry has witnessed fast development in recent years particularly since 2007. Though the outbreak of global financial crisis in 2008 depressed glyphosate industry in the whole

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CCM Data & Primary Intelligence 2009, the capacity of glycine, whose demand is highly subject to Chinese glyphosate market, still kept a rapid increase in 2009, up to XX t/a with over XX companies were active in glycine production. Despite growing capacity, glycine supply had exceeded the demand in 2008, and the fast expansion in 2009 worsened this situation. The operating rate of glycine in 2009 stayed at low level of only XX%. Hebei Donghua Chemical Group is the top glycine producer in Asia with capacity of XX, and the company produced about XX tonnes of tech-grade glycine in 2009. Almost all Chinese glycine producers adopt a lagging technology called chloroacetic acid ammonolysis process. Sanxia Yingli is the only company in China adopting Natural gas-HCN process (improved Hydantion process) to produce glycine though it has suffered a lot in its glycine business notably from unstable production, immature technology and profit loss, etc. Chinese glycine production is highly concentrated, while its upstream industry including both chloroacetic acid and urotropine are scattered. Glycine producers have witnessed poor profit or even loss in 2009 due to sluggish glyphosate market and glycine oversupply. The price of glycine is closely related to urotropine and chloroacetic acid (its key raw materials), as well as Chinese glyphosate market. Hebei Donghua has been playing a dominant position in glycine pricing since it shares more than XX% share of Chinese tech-grade glycine market. Quite different from the overseas consumption structure, the largest end use segment of glycine in China is glyphosate, followed by pharmaceuticals, dyeing, carboxymethyl cellulose (CMC), carboxymethyl starch etc. Output of glyphosate by AEA pathway reached XX tonnes in 2009, consuming about XX tonnes glycine totally. Around XX tonne glycine is consumed to produce 1 tonne glyphosate. Chinese glycine industry trends to develop stably in the coming few years with global economic recovery, promotion of GM crops especially GM soybean and GM corn, and sustained demand for glyphosate, etc. Character of CCM' Report: The aim of this report is to provide powerful assistance to the strategy group and the management team in making correct decision as how to penetrate the ever-increasing China market and how to catch the maximum commercial opportunities. The report is formulated independently by CCM’s professional market researchers, based on the first-hand and primary data which are analyzed by scientific methodology, confirmed with both manufacturers/end users/traders and legal authorities, and presented in a logic way. Sample pages

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Chapter Three

Overview of glycine in China

III-4.1 Brief introduction of chloroactic acid ammonolysis process Table III-4.1.1 Raw material consumption of chloroactic acid ammonolysis process in China, Feb. 2009 No.

Raw materials

Purity, %

Unit consumption, t/t

Price, USD/t

Unit cost, USD/t

1

Chloroactic acid

xxxxx

xx

xx

xx

2

Liquid ammonia

Tech-grade

xx

410.1

xx

3

Urotropine

xxxxx

xx

xx

xx

4

Methanol

xxxxx

xx

xx

xx xx

Total

Table III-4.4.1 Raw material consumption of natural gas route in China, Feb. 2009 No.

Raw materials

Purity, %

Unit consumption, t/t

Price, USD/t

Unit cost, USD/t

1

Natural gas

xx

xx

xx

xx

2

Liquid ammonia

xx

xx

xx

xx

3

Carbon dioxide

xx

xx

xx

xx

4

Formaldehyde

xx

xx

xx

37

xx

Total

III-6 Industry players Table III-6.2 Production situation of Chinese glycine companies, 2009 Output '09,

Output '08,

tonne

tonne

Capacity '09, t/a No.

English name Tech

Tech Others

-grade

Tech Others

-grade

Others

Output of

Operating rate

tech-grade

of tech-grade

'07, tonne

'09, tonne

-grade

1

Hebei Donghua

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

2

Sanxia Yingli

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

3

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

4

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

5

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

6

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

7

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

8

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

9

XXXXXXXXXX

10,000

XXX

XXX

XXX

XXX

XXX

XXX

XXX

10

XXXXXXXXXX

10,000

XXX

XXX

XXX

XXX

XXX

XXX

XXX

11

XXXXXXXXXX

8,000

XXX

XXX

XXX

XXX

XXX

XXX

XXX

12

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

13

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

14

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

15

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX


16

XXXXXXXXXX

XXX

XXX

XXX

XXX

2,000

XXX

XXX

XXX

17

XXXXXXXXXX

XXX

XXX

XXX

XXX

1,500

XXX

XXX

XXX

18

XXXXXXXXXX

XXX

XXX

XXX

XXX

1,500

XXX

XXX

XXX

19

XXXXXXXXXX

XXX

XXX

XXX

XXX

3,600

XXX

XXX

XXX

20

XXXXXXXXXX

XXX

XXX

XXX

XXX

500

XXX

XXX

XXX

21

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

22

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

23

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

24

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

25

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

26

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

27

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

28

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

29

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

30

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

31

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

32

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

33

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

34

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

35

XXXXXXXXXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

36

XXXXXXXXXX

XXX

XXX

XXX

XXX

500

XXX

XXX

XXX

Total

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

Chapter Four Market summary and assumptions IV-1.1 Price Table IV-1.1.1 Price change of tech-grade glycine, 2006-Jan.2010 No. 1

2

3

4

5

6

7

Stage

Price

Jan. 2006 -

Decreased from USD2,001/t in Jan. 2006 to

Oct. 2006

USD1,764/t in Oct. 2006, down 1.39%.

Nov. 2006 Sep. 2007 Dec. 2007 Feb. 2008 Mar. 2008 -

Reasons XXXXXXXXXXXXXXXXXXXX

XXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXX

XXXXXXXXXXXXXXXXXXXX

XXXXXXXXXXXXXXXXXXXX

XXXXXXXXXXXXXXXXXXXX

XXXXXXXXXXXXXXXXXXXX

XXXXXXXXXXXXXXXXXXXX

XXXXXXXXXXXXXXXXXXXX

XXXXXXXXXXXXXXXXXXXX

Apr. 2008 May 2008 Jun. 2008 Jul. 2008 Nov. 2009 Nov. 2009 Jan. 2010


IV-1.2

Export

Table IV-1.2.6 Glycine exports of Chinese major producers, 2009 Feed-grade No.

Manufacturers

Food-grade

Pharmaceutical-grade

Total

Quantity,

Price,

Quantity,

Price,

Quantity,

Price,

Quantity,

Price,

tonne

USD/kg

tonne

USD/kg

tonne

USD/kg

tonne

USD/kg

1

Hebei Donghua

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

2

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

3

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

4

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

5

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

6

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

7

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

8

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

9

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

10

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

11

xxxx

xxxx

xxxx

66.200

1.89

0

0

xxxx

xxxx

12

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

13

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

14

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

15

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

Total

IV-3 Market challenges Chinese glycine industry will face many challenges such as the financial crisis across the world and oversupply of glycine in the future, so China will accelerate integration of Chinese glycine industry. Major challenges for Chinese glycine industry are showed as follows.

…… Table IV-3.1 Strengths and weaknesses of Chinese glycine industry No.

Strengths

Weaknesses

1

xxxxxxxxxxxxxxxx

xxxxxxxxxxxxxxxx

2

xxxxxxxxxxxxxxxx

xxxxxxxxxxxxxxxx

3

xxxxxxxxxxxxxxxx

xxxxxxxxxxxxxxxx


Chapter Five Industry structure and competitive analysis Table V-2.1.1 Major glyphosate producers adopting AEA pathway in China, 2009 No.

Company

Status

Capacity

2010

2009, t/a

Abbreviation

1

Zhejiang Wynca Chemical Group Co., Ltd.

Zhejiang Wynca

active

2

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

active

3

Nantong Jiangshan Agrochemical & Chemical Co., Ltd.*

Nantong Jiangshan

4

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

5

Output

2008,

2009,

tonne

tonne

xxxx

xxxx

xxxx

xxxx

xxxx

active

xxxx

xxxx

xxxx

xxxxxxxxxx

active

xxxx

xxxx

xxxx

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

active

xxxx

xxxx

xxxx

6

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

active

xxxx

xxxx

xxxx

7

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

active

xxxx

xxxx

xxxx

8

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

active

xxxx

xxxx

xxxx

9

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

active

xxxx

xxxx

xxxx

10

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

active

xxxx

xxxx

11

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

active

xxxx

xxxx

xxxx

12

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

active

xxxx

xxxx

xxxx

13

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

active

xxxx

xxxx

xxxx

14

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

active

xxxx

xxxx

xxxx

15

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

active

xxxx

xxxx

xxxx

16

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

active

xxxx

xxxx

xxxx

17

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

active

xxxx

xxxx

xxxx

18

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

active

xxxx

xxxx

xxxx

19

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

active

xxxx

xxxx

xxxx

20

xxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

idle

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

xxxx

Others Total

80,000

Output

10,000

Table V-2.1.3 Main glycine producers and glycine consumers in China, 2009 No.

Glycine producers

Glycine consumers

1

Hebei Donghua

Zhejiang Wynca, xxxxxxxxxxxxxxxxxxxxxxxxxxx

2

xxxxxxxxx

xxxxxxxxxxxxxxxxxxxxxxxxxxx

3

xxxxxxxxx

xxxxxxxxxxxxxxxxxxxxxxxxxxx

4

xxxxxxxxx

xxxxxxxxxxxxxxxxxxxxxxxxxxx

5

xxxxxxxxx

xxxxxxxxxxxxxxxxxxxxxxxxxxx


V-3 Industry concentration of glycine materials Table V-3.1.1 Main urotropine producers in China, 2009 No.

Company

Location

Capacity, t/a

1

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

xxxxxxx

2

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

xxxxxxx

3

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

xxxxxxx

4

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

xxxxxxx

5

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

20,000

6

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

xxxxxxx

7

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

xxxxxxx

8

Jinan Xiangrui Chemical Co., Ltd.

Shandong

xxxxxxx

9

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

Shandong

xxxxxxx

10

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxx

xxxxxxx

11

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxx

xxxxxxx

12

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxx

xxxxxxx

13

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxx

xxxxxxx

14

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxx

xxxxxxx

Sub-total

xxxxxxxxx

National total

xxxxxxxxx

Percentage

xxxxxxxxx

V-4 Industry concentration of glycine companies Table V-4.1 Industrial concentration of glycine in China No.

Item

Value

1

Top one concentration ratio

XXXXXXXX

2

Top five concentration ratio

XXXXXXXX

3

Top ten concentration ratio

XXXXXXXX

4

HHI

XXXXXXXX


Glycine Survey in China  

Glycine, including tech-grade, feed-grade, food-grade, pharmaceutical-grade, is widely used as raw materials for CMC, agrochemicals and surf...

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