On August 10, Shandong Huayang Dr Chemical Industry Co., Ltd. issued an investment announcement, planning to invest approximately 350 million yuan to construct a nitric acid capacity expansion project in the Ningyang Chemical Industry Park, Tai'an, Shandong.
Upon completion, the project will further enhance the company's nitric acid feedstock supply capacity and strengthen the integrated layout of downstream nitrates and molten salt products.
Existing Capacity Shortfall to Be Addressed by New Project
According to the announcement, Dr Chemical plans to build the following facilities in the Ningyang Chemical Industry Park:
| Project | Capacity |
|---|---|
| Dilute nitric acid unit | 300,000 tons/year |
| Concentrated nitric acid unit | 133,200 tons/year |
Supporting utility and auxiliary facilities will also be constructed. The project construction period is expected to be 24 months, with funding sourced from the company's own funds or self-raised capital.
Dr Chemical stated that in recent years, as internal consumption of dilute nitric acid in downstream operations has continued to increase, the existing nitric acid units have faced supply gaps. This new project is primarily intended to supplement the company's internal production needs, while also meeting the supporting demand of the industrial park's supply chain and improving feedstock supply stability.
In addition, the new project will feature upgrades in process technology, equipment configuration, and energy utilization, which are expected to further enhance operating efficiency and deliver benefits in energy conservation, carbon reduction, and economic performance.
From Standalone Capacity Expansion to Integrated Industry Chain Layout
Dr Chemical has long been focused on nitric acid and related products. Its current main product portfolio includes:
- Nitric acid
- Potassium nitrate
- Magnesium nitrate
- Energy-storage molten salts
- High-end water-soluble fertilizers
These products are widely used in concentrating solar power (CSP), energy storage and thermal storage, chemicals, agriculture, military applications, and electronic component manufacturing, among other fields.
This nitric acid project is not a simple expansion of basic feedstock capacity, but rather a step to further improve the company's upstream-downstream integration system. With the additional nitric acid capacity, the company will be able to flexibly adjust the ratio of nitric acid for internal use versus external sales in response to market changes in different products, thereby enhancing production scheduling flexibility.
By strengthening the coordinated industry chain of "nitric acid – nitrates – molten salts / nitro-based water-soluble fertilizers," Dr Chemical will further reinforce its feedstock security and market responsiveness.
Enhanced Industry Position Expected After New Capacity Comes Online
Currently, Dr Chemical has an existing concentrated nitric acid capacity of 135,000 tons/year, with relevant units operating normally and a daily output of approximately 420 tons. After this project is commissioned, the company's overall nitric acid supply capacity will increase significantly.
In recent years, with continued growth in new energy storage, specialty chemicals, high-end agriculture, and other sectors, demand for nitrates and related materials has been rising. For companies with upstream-downstream supporting capabilities, improving feedstock self-sufficiency and optimizing industrial chain structure is becoming an important path to strengthening market competitiveness.
Dr Chemical's expansion project also reflects the broader industry trend toward larger-scale, integrated development in the nitric acid sector.
