On the evening of June 8, Yuntianhua (600096, closing price 28.93 yuan, total market value 52.739 billion yuan) released an announcement regarding external investment. Two wholly-owned subsidiaries, Tian'an Chemical and Environmental Technology, will invest a total of 2.737 billion yuan to launch the New Energy Battery Precursor Supporting Sulfur Cycle Demonstration Project and the Phosphogypsum for Cement with Co-produced Sulfur Cycle Utilization Project, respectively. The core logic of both projects is consistent: relying on phosphogypsum solid waste to achieve internal circulation of sulfur resources, hedging against the pressure of rising sulfur prices caused by geopolitical conflicts in the Middle East, and matching the incremental demand for upstream raw materials of lithium iron phosphate brought by the high growth of the energy storage track.

Sulfuric acid is an indispensable core raw material for the production of wet-process phosphoric acid and lithium iron phosphate, while China's dependence on sulfur imports is extremely high. Both projects utilize phosphogypsum generated in the production process as raw material to produce sulfuric acid, establishing a closed-loop sulfur cycle system. This will significantly reduce the volume of overseas sulfur purchases and mitigate the cost impact caused by raw material price fluctuations.

Tian'an Chemical New Energy Sulfur Cycle Project, with a total investment of 1.578 billion yuan

The project is located in the Anning Caopu Chemical Park and plans to build a 300,000 tons/year wet-process phosphoric acid unit, supporting 800,000 tons/year sulfuric acid and 790,000 tons/year alkaline material capacity. On one hand, the project ensures a stable supply of raw materials for lithium iron phosphate precursors; on the other hand, it locally consumes phosphogypsum by-produced from phosphate fertilizer production, achieving the utilization of solid waste as a resource.

Environmental Technology Phosphogypsum Co-production Project, with a total investment of 1.159 billion yuan

The project is located in the Haikou area of Kunming, with an annual phosphogypsum treatment capacity of 1.5 million tons, capable of producing 800,000 tons of cement and co-producing 600,000 tons of sulfuric acid. The project will further broaden the channels for phosphogypsum consumption and continuously improve the comprehensive utilization rate of solid waste.

This large-scale layout of the sulfur cycle industry chain stems from dual changes in the downstream and upstream industries. On the downstream end, lithium iron phosphate is the mainstream cathode material for power batteries and energy storage batteries. GGII data shows that domestic energy storage lithium battery shipments will reach 630 GWh in 2025, a year-on-year increase of 85%, and the expansion of energy storage continues to drive the demand for upstream phosphorus chemical raw materials such as phosphoric acid and sulfuric acid. Yuntianhua has built a complete integrated "phosphate rock—phosphoric acid—iron phosphate" industry chain, highlighting its advantage in self-owned phosphate rock resources. This supporting acid production capacity will further improve the new energy raw material supply system.

On the upstream cost side, the global sulfur supply chain is highly concentrated in the Middle East. 41% of global sulfur production and 50% of seaborne trade volume come from the Middle East, and 56% of China's sulfur imports in 2025 originated from this region. In early 2026, geopolitical conflicts in the Middle East continued to ferment; shipping in the Strait of Hormuz was obstructed, and operations at local refineries and ports stagnated, restricting nearly 30% of global sulfur supply. Vessels detouring around the Cape of Good Hope tripled freight rates and lengthened logistics cycles, causing the landed price of imported sulfur to surge continuously, putting cost pressure on the entire phosphorus chemical industry.

Addressing the industry challenge of drastic sulfur price fluctuations, Yuntianhua previously disclosed multiple hedging measures at investor exchange meetings: first, locking prices in advance and stockpiling sulfur to lower raw material costs through inventory advantages; second, expanding diversified procurement channels and increasing the purchase of surrounding smelter acid to supplement supply; and third, accelerating the implementation of phosphogypsum-to-acid projects to open up the internal sulfur cycle.

The company stated that domestic sulfur is highly dependent on imports, and significant price fluctuations seriously affect the stability of raw material supply and cost control. The newly built phosphogypsum-to-acid units can revitalize internal sulfur resources at the production end. While efficiently consuming phosphogypsum solid waste and practicing green production, it will significantly reduce the scale of overseas sulfur procurement, enhance the independent guarantee capability of sulfur resources, and effectively improve the supply chain's risk resistance level and integrated cost competitiveness.