The potassium sulfate industry is currently facing a severe crisis, with production costs and selling prices out of sync. Many companies have either halted or reduced their operations, and overcapacity has become a reality. The industry is already experiencing a cold spell, and if large-scale producers continue to expand capacity while raw material prices keep rising, the sector could plunge into an even deeper winter. This year, the price of potassium chloride, the main raw material for potassium sulfate, has surged, while the price of potassium sulfate has remained stagnant. This imbalance has led to a situation where production costs exceed selling prices, pushing the entire industry into a loss-making cycle. Zhang Yumei, General Manager of Shaanxi Jingsheng Sulfate Potash Fertilizer Co., Ltd., stated that they are now producing at a loss. With retail prices at 2,250 yuan per ton and bulk sales at 2,200 yuan, but actual production costs reaching around 2,500 yuan, each ton produced results in a loss of about 300 yuan. Yu Liangming, General Manager of Shandong Liaocheng Santai Chemical Co., Ltd., added that not only has potassium chloride prices risen, but sulfuric acid, another key raw material, has also increased due to higher sulfur prices. Zhao Zhaoying, Director of the Information Center of the Potash Branch of the China Inorganic Salt Industry Association, confirmed that since the Spring Festival, potassium chloride prices have risen sharply, from 1,640 yuan per ton to 2,200 yuan, and are still climbing. As a result, the market for potassium sulfate is upside down, and the whole industry is suffering losses. Faced with these challenges, some manufacturers have chosen to cut back on production, while others remain determined to survive. Zhang Yumei explained that her company had stockpiled potassium chloride when it was cheaper, allowing them to operate for a while longer. However, if potassium sulfate prices don't rise, they may be forced to stop production. Many companies have already done so. Zhai Zhaoying noted that stopping production is not an easy decision. Companies are caught between giving up hard-earned markets or enduring pain in the hope of future recovery. Many are relying on the strong foundation built during previous boom years to weather the current storm. Additionally, the byproduct of potassium sulfate production—hydrochloric acid—has further complicated matters. Due to its high transportation costs and regional price differences, managing this byproduct is a major challenge for many producers. According to Yu Liang, the root cause of the crisis lies in rising raw material prices. China lacks sufficient domestic potassium chloride resources, forcing companies to rely heavily on imports. Countries like Canada, Russia, Jordan, and Israel control much of the global supply, leading to continuous price hikes. This has significantly increased production costs for Chinese potassium sulfate firms. Zhai Zhaoying added that most domestic producers use Mannheim furnaces, which require high-grade potassium chloride. With limited domestic supply and low-quality resources, companies are forced to import, leaving them vulnerable to external pricing pressures. As a result, raw material costs have risen far faster than product prices, leading to widespread losses. Supply and demand imbalances have also played a role. Before 1998, China relied heavily on potassium sulfate imports. But after local production began, the industry grew rapidly due to the price gap between raw materials and finished products. By 2006, installed capacity reached 2.08 million tons, while domestic demand was only 1 million tons, creating a significant oversupply. While many companies struggle, a few large-scale producers with resource advantages, such as SDIC's Xinjiang Lop Nur Potash Co., Ltd., are doing relatively well. With access to abundant local resources, their production costs are much lower, allowing them to maintain healthy profit margins. This has put pressure on other companies that depend on imported raw materials. To ease the crisis, the China Salt Division of the Inorganic Salt Industry has proposed reviving the old policy of exempting potassium sulfate producers from value-added tax (VAT). Currently, companies must pay VAT upfront and wait for a return, which creates cash flow issues. Zhai Zhaoying pointed out that some companies have accumulated over 10 million yuan in unpaid taxes, increasing financial burdens. In addition, the association is encouraging companies to explore overseas markets to alleviate domestic oversupply. It is also promoting energy-saving and emission-reduction initiatives to reduce costs. Finally, the association urges companies to adhere to self-discipline conventions and avoid destructive price competition to stabilize the market.

Polymer Synthetic Material Roller

Polymer Synthetic Material Roller,Calender Roller,Carbon Fiber Roller Shaft,Flattening Roller

Jiangyin Mingda Rubber Roller Co,Ltd , https://www.mingdaroller.com