On 20 Oct., 2016, Zhai Qing, deputy director of the Ministry of Environmental Protection of the People's Republic of China (MEP), confirmed that a total ten inspection groups would be assigned to urge provincial governments and environmental protection departments to implement environmental regulations and in the meantime, to ensure punishments for breaching related rules. This inspection started the next day (21 Oct.) and was conducted in 20 provinces / municipalities / autonomous regions, including Tianjin, Hebei, Shanxi, Inner Mongolia, Laioning, Anhui, Fujian, Jiangxi, Shandong, Henan, Hubei, Hunan, Guangdong, Hainan, Sichuan, Yunnan, Shaanxi, Gansu, Qinghai and Xinjiang.

Source: Baidu

In fact, the environmental inspection system was first officially established by the Environmental Protection Inspection Plan (Trial) approved by the 14th session of the Central Leading Group for Comprehensively Continuing Reform in July 2015. Accordingly, the central government would assign groups of inspectors to conduct related investigations into environmental regulations implemented by the provincial or even city-level governments and relevant departments.

Environmental inspection has been prioritised on the MEP’s agendas in 2016. Early this year, pilot inspections were conducted in Hebei. In mid-July, the first group of inspectors carried out stringent regulation towards enterprises in Inner Mongolia, Heilongjiang, Jiangsu, Jiangxi, Heinan, Guangxi, Yunnan and Ningxia. The inspection continued on in Sichuan and Hubei in mid-Sept. and was further expanded this time in Oct.

This large-scale national environmental inspection may affect the domestic prices of most chemicals, especially pesticides. Most important pesticide producing provinces were covered this time, including Shandong, Henan, Hubei, Anhui, Sichuan, Hebei, Inner Mongolia, Jiangxi, Hunan, Guangdong and Fujian. All these provinces were among the top 15 pesticide producing provinces in Jan.-Aug. 2016, whose output totaled around 1.44 million tonnes, 57.78% of the national total.

Given this, the pesticide business may be seriously influenced – lowering operating rate, tightening supply of raw materials, increasing environmental costs, reducing overall output, all of which are driving forces behind possible rises in pesticide prices. It is expected that the Chinese pesticide market will transition to an upturn in the near future.

Notably, the previous environmental inspection this year has already boosted prices of many pesticides. Rises in prices of pesticide technical has become a trend in the domestic market. For instance, the long-depressed chlorpyrifos price finally rebounded slightly in Sept. 2016, thanks to the increased price of intermediates. Badly affected by the national environmental inspection, most producers of chlorpyrifos TC intermediates had to cut down their production, leading to declined market supply and increased price. Moreover, just a few chlorpyrifos TC manufacturers realised self-supply of intermediates. In this context, many chlorpyrifos producers raised their quotations.

The state had in fact required in-depth and continuous environmental inspection early when the first groups of inspectors were dispatched this year. As the national environmental regulation gets increasingly stringent, it noteworthy how the domestic pesticide manufacturers will cope with the coming challenges.

Top 25 pesticide producing provinces in China, 2015 & Jan.-Aug. 2016

Source: National Bureau of Statistics of the People's Republic of China

Top 10 producing provinces of fungicides / insecticides / herbicides in China, Jan.-Aug. 2016

Source: National Bureau of Statistics of the People's Republic of China

This article comes from Insecticides China News 1610, CCM

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Tag: pesticides  insecticides

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