The central bank announced on the evening of April 5 that since April 6 the benchmark deposit and lending rates of financial institutions have been raised, with the one-year deposit and lending benchmark interest rates rising 0.25 percentage points respectively. After adjustment, the one-year deposit and loan interest rate reached 3.25% and 6.31%, respectively. This is the fourth time the central bank has implemented it since last year and is the second time since this year. In the past few days, some chemical companies have complained to journalists, and they have tried every means to resolve the negative effects of such transmission. As we all know, the chemical industry is a large-scale, capital-intensive industry, and it is sensitive to the loan interest rate fluctuation and financing environment. Since last year, in order to ease inflationary pressure, the central bank has frequently used quantity and price instruments, and has raised the deposit reserve ratio of financial institutions 9 times in order to reach a historical high of 20%, while implementing four interest rate increases. The above actions of the central bank are an important means to control the scale of capital injection. This undoubtedly increases the difficulty of corporate loans and directly increases the production costs of the company. Since the “Eleventh Five-Year Plan†period, the chemical industry has developed rapidly. The infrastructure construction and technological upgrading of local enterprises have also been in full swing. However, these construction funds are mainly obtained through bank loan financing. Therefore, the central bank repeatedly raise interest rates to make these companies generally feel pressure. Steep increase. “In recent years, we have successively implemented public works projects such as an annual output of 200,000 tons of methanol, 180,000 tons of synthetic ammonia, and 300,000 tons of urea, as well as ground water plants and thermal power plants. The company’s bank loan balance is now 1.2 billion yuan. The interest rate increase will increase the company's financial expenses by more than 3 million yuan. This is not a small number for chemical companies that are in a situation where the industry is not booming,†said Li Fuxiang, deputy general manager of Jiangsu Hengsheng Chemical Fertilizer Co., Ltd., told reporters. For the central bank to raise interest rates frequently, some chemical companies have already anticipated and prepared. Fan Xide, general manager of Jiangsu Tianjia Edible Chemicals Co., Ltd. believes that the current consumer price index (CPI) is high. In February this year, the CPI rose 4.9% year-on-year, and the ex-factory price of industrial products (PPI) rose 7.2% year-on-year. There is a possibility of high innovation in March. Therefore, the central bank's intention to increase interest rates is intended to respond in advance. Although interest rate hikes will have a positive effect on relieving negative interest rate levels and curbing inflation, the impact on the production and operation of enterprises must not be underestimated. "It must be noted that continuous interest rate hikes will increase the repayment pressure of enterprises. When the price of production materials rises, if financing costs are also raised, it will be detrimental to the operation and development of enterprises, especially small and medium-sized enterprises." The principal Zhang Qizuo said. Since the central bank continues to raise interest rates has become a high probability event, then based on irreversible financing, repayment pressure, how should the EPC improve various production and business activities, and what tricks to take to effectively overcome the difficulties? Li Fuxiang said that at present, the company is trying to digest its negative impact on corporate profits by tapping its potential. The company will carry out key technological transformations on key gasification processes, and plan to reduce the coal consumption index per ton of ammonia by 16 kilograms and take measures to reduce the ton of ammonia electricity consumption by 46 kwh. It also plans to allocate more than 200 million yuan of energy-saving and emission-reduction funds, implement the transformation of blower gas recovery boilers, "three wastes" co-combustion furnaces and other equipment, pretreatment of raw coal screening, gas desulfurization recovery, and improvement of the production water recycling system, etc. Tap potential to improve the company's operating results. "In addition, we will also strengthen the basic management of enterprises, strictly control all expenses, and take measures to ensure that the company will increase profits by more than 20% this year based on the profit of 80 million yuan last year," said Li Fuxiang. Van Hidde said that since the interest rates will continue to rise during the year, the entire industry and its downstream will have different levels of financial constraints and increased production costs and other issues. In order to cope with the profit-reducing effect brought about by such conduction, the company’s main practice in operation is to maintain multi-category and small-batch production, maximize credit control, maintain cash sales, and reduce receivables, in order to speed up capital turnover. Increase the number of turnovers. “Our private small and medium-sized enterprises have difficulty financing. Frequent increases in interest rates increase production costs and reduce profitability. As a result, we can only suspend the production of unprofitable or low-profit products in the next production and operation arrangements.†Huaibei Green Chemical Co., Ltd. Anhui Zhao Qi, general manager of Science and Technology Co., Ltd., told reporters that the first thing the company needs to do is to intensify market development, aim at high-efficiency agriculture, and expand the company's efficient fertilizer potassium dihydrogen phosphate market, to overcome the current difficulties. 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