The Urethane Blog

Ningbo Overview

Chemicals a cornerstone of Ningbo’s economy

NINGBO, a port city in Zhejiang Province, is becoming an increasingly important player in China’s chemical industry as producers recognize the strength of its local resources.

In late October, Netherlands-based chemicals company AkzoNobel opened a new plant in Zhenhai District, northeast Ningbo. The plant is capable of producing 18,000 tons of organic agrochemicals annually.

Werner Fuhrmann, the executive responsible for the company’s specialty chemical business in the city, settled in Ningbo eight years ago.

“Ningbo provides rich raw materials, and during the past eight years, it has attracted more and more chemical partners,” said Fuhrmann.

Ningbo is already one of the largest crude transshipment centers in China, and oil refining and chemical companies are expanding rapidly around its port.

But Ningbo is more than just an industrial center. It has been named one of the most environmentally friendly cities in Zhejiang thanks to its efforts to curb pollution and promote sustainability. This focus on quality living and the environment has helped make it a desirable destination for some of the world’s largest industrial companies.

Apart from AkzoNobel, earlier this year China National Offshore Oil Corp and Oriental Energy jointly co-invested a combined 19.8 billion yuan (US$2.9 billion) to expand production in Ningbo. This investment is expected to add 76 billion yuan to the value of Ningbo’s industrial output, local media report.

Ningbo’s oil refining and chemical industries have generated output valued at more than 300 billion yuan annually since 2013. All told, the city’s total industrial output was valued at 1.3 trillion yuan last year.

Also making Ningbo attractive to producers are its well-developed, synergistically-linked industrial chains.

AkzoNobel’s newly-opened specialty chemicals plant, for example, requires chemical inputs such as ethylene, a major product of the oil refining industry. At the Ningbo Zhenhai Chemical Industrial Park, chemical and oil refining companies satisfy each other’s needs for commodities and raw materials.

AkzoNobel’s main partner in Zhenhai is Sinopec Zhenhai Refining & Chemical Co, China’s largest crude refining company. Every year the latter pumps out over 25 million tons of refined oil and 1 million tons of ethylene, crude’s main derivative.

In Ningbo, oil-refining giants not only have the easy access to needed inputs, but they also can sell their products to a host of nearby downstream buyers.

Covering 56.22 square kilometers, the Zhenhai chemical park abuts the nation’s largest liquid chemicals port, where annual storage exceeds 5 million tons.

Energy giant Sinopec Zhenhai, for instance, benefits from its location as almost 90 percent of its incoming crude is imported, most of it arriving via ports in Ningbo.

In the coming years, Ningbo has vowed to further enlarge supplies for its oil refining and chemical firms. In 2011, it established an energy and chemical trading center in Daxie, an island to the city’s east, which will be developed into the largest clean energy trading center in northeast Asia, according to official proposals from the Ningbo government.

While the trading center now handles about 10 percent of the nation’s annual crude imports, in the coming years Ningbo plans to build four crude and liquid chemical ports on the island, adding more than 650,000 tons to the annual throughput of Ningbo port as a whole.

Nowadays almost 90 percent of chemical-industry multinationals in China value social responsibilities, while 75 percent of them have made environmental protection a major priority, according to a report from the Association of International Chemical Manufacturers in August.