Hanfeng to expand capacity

Toronto-Hanfeng Evergreen Inc. reports that it will expand production capacity at its Heilongjiang facility in China by an additional 100,000 mt/y with the construction of a NPK coating plant, which will utilize two patented technologies developed by Hanfeng. It will acquire raw land adjacent to their existing site to accommodate the construction of the new production plant, additional warehouses, and a rail spur to move raw materials and finished goods to the main railway line. Construction is expected to begin in May of 2007, with the first phase of 50,000 mt/y to be commissioned at the beginning of October 2007 and the second phase at the beginning of February 2008. When the new plant is completed, the Heilongjiang facility will have 450,000 mt of annual production capacity, including 150,000 mt of coating and blending capacity. The new coating plant will utilize Hanfeng’s technologies to produce a polymer-coated compound and a sulfur coated compound. The technology can precisely control the nutrient releasing period for up to 12 months, and has the added benefit of enabling Hanfeng to apply the coatings on NPK granules, instead of a single nutrient like urea. The estimated total budget of this project, including additional land costs, is approximately $85.2 million RMB (or CAD$12.5 million), and will be funded from proceeds generated by the $80 million in share subscriptions by Agrium Inc. and PetroChina Petrochemical Co. Once completed, the 100,000 mt expansion will increase Hanfeng’s total annual productive capacity from all facilities to 700,000 mt, including 400,000 mt of NPK capacity, 100,000 mt of sulfur coated urea capacity, 100,000 mt of NPK coating capacity, and 100,000 mt of blending capacity.