Shanghai launches fine chemical base
By Chen Qide (China Daily)
Updated: 2004-12-20 08:51

SHANGHAI: A fine chemical base was opened in Shanghai's chemical industry park yesterday, which is expected to create US$1.1 billion in new projects launched.

At yesterday's cornerstone-laying ceremony, two projects with a combined investment of more than 2 billion yuan (US$242 million) were inaugurated as the base's initial projects.

One project was mounted by the Huasheng Chemical Co Ltd affiliated with Shanghai Huayi (Group) Company with an investment of 1.87 billion yuan (US$226 million) to produce an annual 360,000 tons of caustic soda and 360,000 tons of polyvinyl chloride (PVC).

Both products are important raw materials for the chemical industry and the project will be put into operation in the first half of 2006.

Huayi's 3F New Materials Co Ltd launched the second project which costs 150 million yuan (US$18 million) in its first phase and plans to produce 1,000 tons of polyvinylidenefluride (PVDF) and 100 tons of hexafeuroacetone (HFA) annually.

"Launching the two fine chemical projects means Huayi will consider the base a major part of its strategy to advance the city's new chemical industry," said Huayi Chairman Zhang Peizhang.

The PVDF produced by the 3F company with its own knowhow will serve as raw materials for the production of high-grade coatings and lithium batteries, said 3F general manager Huang Jiongjiong.

The world now produces 20,000 tons of PVDF annually, including 400 tons produced in 3F's old factory which will close as the new facility opens in 2006.

"The annual 1,000 tons of PVDF is still far from enough to meet the growing demand," Huang said.

Zhou Yunhe, chairman of 3F, said the company will begin the second phase in three to four years to increase its annual output to 3,000 tons.

"We will spend 100 million yuan (US$12 million) more on the second phase project to produce PVDF for wire and cable manufacturers," Zhou said.

Local chemical insiders said 3F's PVDF will partly satisfy the demand of domestic customers who are now relying on imports.

Fine chemicals have a huge potential market in China and more projects will be launched in the base later on, Zhang said. Their combined investment is expected to exceed 9 billion yuan (US$1.1 billion).

Huayi has invested 16 billion yuan (US$2 billion) in projects for the first phase of the Shanghai Chemical Industry Park. Some projects will be completed and put into operation in 2005.

"Thus starting next year, the park will be able to manufacture 20 billion yuan (US$2.4 billion) worth of products annually," said Ruan Yanhua, director of the park's management committee.

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