LONDON, March 6, 2017 /PRNewswire/ -- Editor's Note
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Welcome to the Jan. Issue of Herbicides China News.
This newsletter will help you stay ahead of the game in this fast-changing market with real-time reporting on the entire herbicides industry chain, from raw materials to end consumption. It includes breaking news from China and abroad, the latest market data (price, import & export, production, consumption, operating rates, etc.), in-depth analysis of market trends, Chinese government policy, performance of leading Chinese producers, M&A, new technologies, and expert commentary from industry insiders.
Here is the Editor's Note for you to know about the Jan. issue specifically:
Compared to the end of 2016, China's herbicide market cools down in early 2017. Although price rises of some herbicides have been narrowed down, some even started to fall, the market still presented an uptrend. As of Jan., most of herbicides were in tight supply, especially spot products. Affected by serious smog, herbicide producers in main producing areas, such as Shandong and Hebei provinces, maintained low operating rate, some even suspended production. It is predicted that production resumption will be after the Spring Festival Holiday.
Glyphosate TC also suffered tense supply. Most producers said that there were many orders stockpiled. Purchasers held wait-and-see altitudes, but producers still quoted a high price.
Quotations for glufosinate-ammonium TC also kept high. Some trade sources predicted that as the peak season for formulations production came, demand for glufosinate-ammonium TC may far exceed supply.
Oxyfluorfen TC, affected by tight supply and rising prices of intermediates, recorded rises in quotations.
In 2017, China will keep strengthening inspection efforts on pesticide residues, or may promote the environmental inspections nationwide. At the same time, the country plans to issue the Emission Standard of Water Pollutant of the Pesticide Industry this year.
Herbicides China News is a monthly published newsletter, which can be downloaded in PDF format. The subscription mode for this newsletter is yearly and the subscriber will receive 12 issues per year.
Headlines
People from all walks of life are concerned about whether Zhejiang Wynca, a listed company, will able to turn loss into gain in 2016 net profit, with the help of the gradually rising glyphosate price since H2 2016. However, under the influence of multiple factors, the annual net profit of Zhejiang Wynca in 2016 is still full of variables.
In recent years, Shandong Vicome Greenland has suffered serious losses. This significantly dragged down the financial performance of its parent company, Shandong Shengli. On the last day of 2016, Shandong Shengli announced that it will sell Shandong Vicome Greenland.
Thanks to the promising sales in Q4, Lier Chemical predicted a YoY rise of 55% in 2016 net profit, a rise of 15-25 percentage points over the previous forecast.
2016 witnessed opportunities and challenges in Chinese pesticide industry. CCM selected 10 major keywords to summarize the industry development in 2016.
2016 witnessed opportunities and challenges in Chinese pesticide industry. CCM selected the 10 major keywords to summarize the industry development in 2016. In this article, the remaining 5 keywords will be introduced.
Since Sept. 2016, China's oxyfluorfen price has been rising, and industry insiders predicted that the uptrend will continue in the short term.
In Jan.-Nov. 2016, China's export volume of glufosinate-ammonium experienced two-digit growth, but the export price slumped.
In Jan.-Oct. 2016, China's export volume of diauqat TK recorded a large YoY rise. Although the entire herbicide market remained depressed in 2016, export price of diquat TK did not drop significantly.
In Dec. 2016, 6 new herbicide TC were formally registered by 4 companies in China, involving 6 herbicide active ingredients.
In 2016, 126 herbicide TC were newly registered in China, involving 64 active ingredients. Of this, 6 active ingredients were registered in China for the first time, by 6 companies.
Editor's Recommendation
Recommended article for Herbicides China News 1701:
Zhejiang Wynca: variables in 2016 net profit
Summary: People from all walks of life are concerned about whether Zhejiang Wynca, a listed company, will able to turn loss into gain in 2016 net profit, with the help of the gradually rising glyphosate price since H2 2016. However, under the influence of multiple factors, the annual net profit of Zhejiang Wynca in 2016 is still full of variables.
Zhejiang Wynca Chemical Group Co., Ltd. (Zhejiang Wynca) is a major domestic listed glyphosate manufacturer in China, but in recent years, its financial performance has shown a declining trend due to the continued sluggish market and the continuous decline of glyphosate price. People from all walks of life are concerned about whether Zhejiang Wynca will be able to turn loss into gain in 2016, with the help of the gradually rising glyphosate price since H2 2016. However, under the influence of multiple factors, the annual net profit of Zhejiang Wynca in 2016 is still full of variables.
Environmental litigation may reduce 2016 net profit of Zhejiang Wynca
On 7 Jan., 2016, Zhejiang Wynca issued the follow-up announcement on environmental litigation, which said that the company had recently received the paper of civil judgment issued by the Intermediate People's Court of Dongying City, Shandong Province in terms of the environmental litigation in which two persons and 3 units were involved. The 3 units included Zhejiang Wynca and its affiliated factory, No. 2 Jiande Chemical Factory.
The main contents of the civil judgment were as follows:
1. Zhejiang Wynca, No. 2 Jiande Chemical Factory and Jiande Hong'an Transportation Co., Ltd. (Jiande Hong'an), Li Qiang, and Li Zhaofu shall immediately stop illegally transporting mixed phosphate liquor overseas for disposal, and they shall pay the cost of environmental pollution control, at USD3.27 million (RMB22.74 million - 11,370 tonnes were transported overseas, unit price at USD287.78/t - RMB2,000/t). In addition, they shall together bear the attorney fee of USD1,726.67 (RMB12,000), and the court acceptance fee of USD2,237.43 (RMB15,550).
2. Zhejiang Wynca, No. 2 Jiande Chemical Factory and Jiande Hong'an, Li Qiang, and Li Zhaofu shall be jointly and severally liable for the above-mentioned liabilities.
Zhejiang Wynca said the above matters might have a certain negative impact on the company. For the case, Zhejiang Wynca had already withdrawn about USD275,556.13 (RMB4 million) at the end of 2014. If the judgment become effective, the annual profits of Zhejiang Wynca in 2016 would be decreased. Zhejiang Wynca would make predictions of its 2016 financial performance before the end of Jan. 2017 as soon as possible.
Zhejiang Wynca received USD3.02 million (RMB21 million) of relocation compensation at the end of 2016
On 30 Dec., 2016, Zhejiang Wynca issued an announcement on the company's receipt of compensation for relocation. The announcement said that on 29 Dec., 2016, the company received USD3.02 million (RMB21 million) relocation compensation. After preliminary accounting, the compensation would be included in the non-operating income of Zhejiang Wynca in 2016. CCM believes that the timely arrival of the compensation payments will effectively help Zhejiang Wynca get out of the red in 2016.
Event review: On 8 Dec., 2015, Zhejiang Wynca and Jiande City Construction and Development Investment Co., Ltd. signed the Overall Relocation Compensation Agreement on the Bainanshan Block, in which the total amount of compensation for the overall relocation was decided to be USD65.64 million (RMB456.1846 million).Event review: On 8 Dec., 2015, Zhejiang Wynca and Jiande City Construction and Development Investment Co., Ltd. signed the Overall Relocation Compensation Agreement on the Bainanshan Block, in which the total amount of compensation for the overall relocation was decided to be USD65.64 million (RMB456.1846 million).
Zhejiang Wynca gained rich income by selling equities of subsidiary
On 13 Dec., 2016, Zhejiang Wynca announced that it planned to sell 5% of equities in Zhejiang Hanghua New Material Technology Co., Ltd. (Zhejiang Hanghua) for USD3.01 million (RMB20.7522 million), which was regarded as an approach to turn loss into gain and to realize its operation targets. For more details, please refer to the Glyphosate China Monthly Report 1612: Zhejiang Wynca intends to sell subsidiary's equity to gain profit.On 13 Dec., 2016, Zhejiang Wynca announced that it planned to sell 5% of equities in Zhejiang Hanghua New Material Technology Co., Ltd. (Zhejiang Hanghua) for USD3.01 million (RMB20.7522 million), which was regarded as an approach to turn loss into gain and to realize its operation targets. For more details, please refer to the Glyphosate China Monthly Report 1612: Zhejiang Wynca intends to sell subsidiary's equity to gain profit.
The rising price of glyphosate indicated good news for Zhejiang Wynca's annual profit
"Our operational benefits have been improved due to the improved market of glyphosate and organic silicon. We are able to basically get out of the red in 2016 even if excluding the income from equity transfer," said Zhejiang Wynca.
The price rebound of glyphosate helped Zhejiang Wynca get out of the business difficulties. The sales of glyphosate increased, which may largely boost Zhejiang Wynca's annual profit. Chinese glyphosate market had begun to witness a price rebound since Sept. 2016, and as of the end of Dec. 2016, the price of glyphosate was still increasing. For details, please refer to Glyphosate China Monthly Report 1611: Zhejiang Wynca may turn loss into gain in 2016. The price rebound of glyphosate helped Zhejiang Wynca get out of the business difficulties. The sales of glyphosate increased, which may largely boost Zhejiang Wynca's annual profit. Chinese glyphosate market had begun to witness a price rebound since Sept. 2016, and as of the end of Dec. 2016, the price of glyphosate was still increasing. For details, please refer to Glyphosate China Monthly Report 1611: Zhejiang Wynca may turn loss into gain in 2016.
Subsidiary's applying to be listed on NEEQ may increased profitability of Zhejiang Wynca
On 10 Jan., 2017, Zhejiang Wynca announced that its subsidiary, Shandong Xinfeng Seed Co., Ltd. (Shandong Xinfeng) would apply to be listed on the National Equities Exchange and Quotations (NEEQ). It was revealed that Zhejiang Wynca is the largest shareholder of Shandong Xinfeng, with 44.01% of equities.
Shandong Xinfeng is mainly engaged in R&D, production and sales of corn seed and wheat seed. As of 30 June, 2016, Shandong Xinfeng's total assets and net assets amounted to USD23.68 million (RMB164.59 million) and USD16.20 million (RMB112.62 million) respectively. In the first six months of 2016, the sales of Shandong Xinfeng hit USD3.48 million (RMB24.17 million), and its net profit was -USD0.21 million (-RMB1.44 million).
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