Status of Sodium Sulfide Production in China   
  
By Dai Chengzhi, Specialist Group of Inorganic Salt, Acid and Alkali Committee of the Chinese Chemical Society   

1. Unjustified expansion     

In recent years, driven by the rising price of sodium sulfide, and also due to the simple production process, low minimum investment, short construction period and low regulatory threshold for entry, numerous new sodium sulfide projects have appeared, all across China. According to incomplete statistics, the number of sodium sulfide producers in China has reached more than 80, with a total capacity of 1.525 million t/a. Adding the 70 000 - 80 000 t/a of sodium sulfide output as a byproduct of barium sulfate production, the nation's total sodium sulfide capacity has reached 1.6 million t/a. Producers are distributed mainly in the Xinjiang region, Inner Mongolia region, Sichuan, Gansu, Shanxi and Shaanxi provinces, among which Xinjiang has the largest capacity, reaching 440 000 t/a.
   Between the winter of 2008 and the spring of 2009, due to the impact of the global financial crisis, the sales of sodium sulfide dropped significantly. However, the market downturn had no effect on the booming capacity expansion. Currently, 310 000 t/a of new and expansion capacity is being developed.
   The production efficiency of sodium sulfide is closely related to the quality of raw material coal and mirabilite, and the workers' operating skills, as well as the management level of the enterprise. Limited by these factors, the actual effective sodium sulfide production capacity in China is only about 1 million t/a. It is expected that after the projects under construction and expansion are all put into operation in the next two years, the total effective sodium sulfide capacity will reach 1.25 million t/a.

2. The market demand is limited    

Under normal world economic circumstances, if China has a complete variety of sodium sulfide products and the products are marketable, it is estimated that in both international and domestic markets, the potential demand for sodium sulfide can reach about 900 000 t/a, and its actual sales can reach more than 700 000 t/a.
    At present, China's sodium sulfide capacity is much greater than the market demand. Domestic demand for sodium sulfide this year is estimated to be only about 350 000 to 400 000 tons. Today, although the global financial crisis has stopped worsening, it will take 3 to 5 years or even longer for the world economy to return to normal. This means that the market demand for sodium sulfide in China can hardly rise to 700 000 t/a or even to 900 000 t/a for several years to come. Even if that were possible, China's actual sodium sulfide capacity would still be far greater than the market demand, which will inevitably result in a shake out of weaker sodium sulfide producers.

3. Difference cost in different regions   

Sodium sulfide is a typical resource-intensive industry. The quality and price of raw material mirabilite and coal available to a producer are the main factors in its competitiveness. In addition, transportation cost is an important factor.
   New construction and expansion projects in certain locations will have more competitive cost advantage because of their much lower feedstock costs, despite paying higher transportation costs than producers in other regions:
    * those in Balikun county of Xinjiang region, which will bring the total sodium sulfide capacity in this region to 250 000 t/a when they are fully operational.
    * those in Haixi of Qinghai province, which will bring the total local capacity of sodium sulfide to 170 000 - 180 000 t/a after they begin operation.
    * the 100 000 t/a common-grade sodium sulfide project of Qinghai Salt Lake Sanyuan Potash Fertilizer Co., Ltd.
    * the 90 000 t/a low iron-content sodium sulfide and the 10 000 t/a special sodium sulfide projects of Haixi Hongwen Chemical Co., Ltd., which will go on stream in the next two years.
        
    New sodium sulfide capacity in China    
    Company                                   Capacity (000 t/a)     Remarks
    Qinghai Salt Lake Sanyuan Potash Fertilizer Co., Ltd.
                                              100                average quality
    Haixi Hongwen Chemical Co., Ltd.          100            low iron content (90 t/a)
                                                            special type (10 t/a)
    Ejinaqi of Inner Mongolia                 50                average quality
    Guazhou of Gansu province                20                average quality
    Jinghui Sodium Sulfide Plant             30                average quality
    Sanyou Salt Chemical Plant              10                average quality
    Total    310
        
    Consumption and export of sodium sulfide in China (000 t)
    Year                       2004    2005    2006    2007    2008
    Apparent consumption      566     625     650     700     530
    Export volume              98      118     128     174     142
    Source: Acid and Alkali Committee of the Chinese Chemical Society