AgroPages-Hunan Haili’s net profit in first three quarters of 2019 increases by 587.89%-Agricultural news

On 28th October, 2019, Chinese agrochemical company Hunan Haili issued its business report for the third quarter of 2019, covering a period from January to September. The company recorded an operating revenue of Yuan1.542 billion, a year-on-year increase of 46.48%, as well as a net profit attributable to the parent company of Yuan77.8769 million, which is a year-on-year increase of 587.89%.

The growth of the company is due to the following reasons:

1) The volume and price of its main products, carbofuran and methomyl, have both been rising.

2) It began production of its star product, larvin, which is expected to bring the company a revenue of around Yuan300 million this year.

Hunan Haili is China’s main supplier of carbamate pesticides, which is in very high demand. Firstly, its raw material is the highly toxic product, phosgene, and its production capacity is strictly prohibited. Secondly, its core intermediates, MIC and alkylpheno, are dangerous and are produced through a difficult process. MIC is highly toxic and unstable, requiring low-temperature storage. Supplies of this chemical group, which includes benzofuranol, are sold by only two local Chinese companies. Thirdly, registering the company’s products is a difficult process, as carbamate pesticides are toxic and are banned in several countries. The Chinese Ministry of Agriculture stopped accepting registration applications for carbofuran and methomyl in 2011.

Hunan Haili and Bayer cooperated in establishing a major project, an annual 4000-ton larvin project, which began production in 2018 and reached full production capacity in the first quarter of 2019. The project is expected to bring the company an annual revenue of about Yuan300 million, accounting for over 20% of its total revenue in 2018. The company's exclusive product, o-hydoxybenzonitrile, as well as expanded carbosulfan, pirimiphos-methyl and other chemicals, will enter production in 2019-2020 and will become new sources of profit and growth.

According to the company's business report, Hunan Haili will establish a wholly-owned subsidiary, Ningxia Haili Technology Co. Ltd., with a registered capital of Yuan100 million. Ningxia Haili will establish its Ningxia production base over several stages using its own funds. Upon completion of the project, the company’s new product capacity will create a new source of profit growth, which will further enhance its core competitiveness.