CHINA SUNSINE: Getting ahead through environment-friendly efforts

'Portuser' contributed this article to NextInsight

The recently-released 2013 annual report of China Sunsine Chemical offers its first-ever environmental and social performance statement.

300_xuchengqiu Xu Cheng Qiu, executive chairman of China Sunsine. NextInsight file photoIt is not a requirement for companies to report on their performance in these areas.

Many companies who do so simply state their commitment to be as green and as socially responsible as possible.

But Sunsine’s statement (pages 40-44 of the annual report) provides data on, for example, the reduction in both water consumed and waste water discharged -- and an increase in water recycling.

Sunsine uses tap water in its production processes, and treats the resultant polluted water to acceptable levels before discharging it into water courses.

When further treated, the effluent can become suitable for reuse in its production processes.

The company is the largest producer of rubber accelerators in the world and the largest producer of insoluble sulphur in the PRC. These chemicals are used in tyre manufacturing.

	2013	2012	Change
Water drawn from taps (cubic metres)	670,000	805,000	(17%)
Amount of water recycled (cubic metres)	350,000	70,000	400%
Total amount of water used (cubic metres)	1,020,000	875,000	17%
Output of goods (tonnes)	98,345	81,371	21%

In 2013, Sunsine treated 350,000 cubic metres of effluent for reuse, and this cut down its demand of tap water.

In all, Sunsine used 1.02 million cubic metres of water last year (see table).

For perspective, the entire population and industry in Singapore use 1.3 million cubic metres of tap water daily.

It is significant that the 17% increase in the amount of water (both tap water and recycled water) used in 2013 was proportionately less than the 21% rise in the output of goods.

watertrreatment4.14 Sunsine's water treatment facility.
Photo: annual reportThe company attributed the improvement to the adoption of more advanced production processes and equipment, and the use of cleaner raw materials.

Further treating the effluent for reuse, instead of relying wholly on tap water, also resulted in less effluent being discharged into water courses (525,000 cubic metres in 2013 against 700,000 cubic metres in 2012), lessening the burden on the water body.

Sunsine has been complying with the discharge standards and is grabbing business previously undertaken by rivals who are having difficulty in complying with the discharge standards.

Its extra effort in water conservation is likely to set Sunsine further apart from its rivals and help it to win more business from tyre manufacturers who are concerned about the environmental impact of the manufacturing processes of its own as well as its suppliers.

sunsine-products Rubber accelerators in powder form being packaged by Sunsine workers wearing safety masks. NextInsight file photoAlthough the cost of recycling wastewater may be higher than the tap water tariff saved, there are intangible benefits arising from Sunsine being branded as an entity that goes the extra mile to protect the environment.

The company said its environmental expenditure increased 36% from RMB 23.5 million in 2012 to RMB 32.0 million in 2013 as the Group placed more emphasis on environmental protection.

In any case, the company's 2013 profit of RMB 77m was reasonable enough even though it incurred water recycling cost.

Through its environment-protection measures, Sunsine has surged ahead of its competitors in business, as a commentary in the just-released 1Q 2014 results by Sunsine strongly suggests →

"As the China government is placing more emphasis on environmental protection, some medium- and small-sized players in the rubber chemicals industry were forced to suspend their production. Further, due to the China government’s comprehensive measures on environmental protection, a few large-sized players also suspended their production.

"As such, the supply of accelerators in the market is decreasing. In order to maintain their productions to meet higher demand of tires, the tire makers placed more orders to purchase accelerators. The Group anticipates that the sales volume of accelerator products will continue to increase.

"However, as Insoluble Sulphur and Anti-oxidant products cause less harmful environmental effects, and the Chinese government has not introduced environmental controls on such products, some players have switched into these business segments. As such, the Group anticipates the competition in these business segments to be more intense."

Recent story: 3 S-chips: Strong buying interest by some investors

Comments

#2 Anex 2014-05-01 19:55

Anti Sunsine: You are anti for what reason? If the business strengthens, and there is greater appreciation by the market, the stock price will float up to 40 cents!

#1 Anti Sunsine 2014-04-30 23:41

Despite all these articles, sunsine has continued to languish at low 20 cents, since the recent slump from the peak at 30 cents...

this is Mr market's response to this type of S-chips...

Refresh comments list

CHINA SUNSINE: Getting ahead through environment-friendly efforts

You may also be interested in:

Comments