Corporation Social Responsibility

• Interest rate risk and financial leverage risk: Rapid interest rate hikes and substantial interest rate hikes will increase the company's costs and affect operating liquidity.
• Exchange rate risk: Group business transactions are not a single currency, and exchange rates may affect the company's additional costs and risks.

Current implementation measures:
The company has been operating stably. In addition to general company operations, market demand and company surplus funds are considered when making capital expenditures, and planned gradual expansion. The current surplus is sufficient to fully meet the capital expenditure needs of the industry; investment also fully considers the company Cast out after ability. Borrowing is only a short-term capital demand turnover, and the time is extremely short, so the interest rate risk is low. As for the capital-intensive ship transportation business, because of the floating interest rate, when interest rates rise rapidly, the burden of borrowing interest will greatly increase the risk.

Future goals

1. Adopt a reasonable financial leverage ratio to control the overall cost.
2. Capital expenditure is to enter into long-term financing contracts with financial institutions, and negotiate with financing institutions to lock in short-term interest rates for 3 to 6 months to reduce the immediate impact of interest rate changes and short-term costs.
3. Increase the investment of own capital in a timely manner, reduce the total amount of borrowings and reduce the impact of changes in financing interest rates.
4. When cash flow permits, reduce the loan balance.
5. Due to the proportion of business and trade, the company adopts natural hedging methods.
6. Another important business, "ship transportation business", whose main currency income and expenditure are US dollars, so it is naturally hedging; if there are major contracts of different currencies, there are also financial quotas that can be used as financial instruments to lock in exchange rates to avoid risks.
7. The company does not do speculative derivatives transactions, so there is no risk of related uncertainty.

• The continuous development of new production capacity and the expansion of existing production capacity have caused an imbalance of oversupply.
• Price competition may cause difficult sales, lower profits or even loss.
• Potassium chloride is also one of the main potash fertilizers, and its production cost is cheaper than potassium sulfate, and when the price difference is too high, it is relatively more substituted.

Current implementation measures

1. Expand production capacity, fully produce and sell fully, and reduce manufacturing costs.
2. Seek to cooperate with other suppliers to avoid vicious competition.
3. Actively grasp the market price trend, so that it can gain an advantage in the price of raw materials.

Future goals
Continue to improve the manufacturing process and strengthen product differentiation.

• Production uncertainties such as environmental safety, government policies, process instability, etc.
• Climate factors change demand and cause operational problems.
• Market demand and competition.
• The operator's inheritance fault, training, and experience are insufficient.

Current implementation measures

1. Always pay attention to the new government policies and make necessary improvements.
2. Complementary and regular training courses for new recruits.
3. The machine implements TPM, and prepares spare parts for emergency needs.
4. In response to market needs, RD will upgrade its products.

Future goals
Seek opportunities for cooperation with other suppliers in the same industry.

Current implementation measures

1. Strictly control and monitor the emission reduction of air, water, and waste in the manufacturing process to achieve the goal of zero pollution.
2. Strengthen the operation and inspection of anti-pollution equipment, and continue to maintain and maintain pollution prevention equipment.
3. Encourage the classification of business waste, implement waste reduction and resource recovery.
4. Implement an environmental management system, strengthen employee education and training, and strengthen emergency response capabilities.
5. The production process implements operating environment testing, and the plant is greened and planted to establish a clean operating environment.

Future goals
Continuously improve the pollution prevention and control work of the Suao Plant and the greening and beautification of the plant, and promise to continue to improve and enhance the corporate image.

• The main raw materials for the production of potassium sulfate are sulfuric acid and potassium chloride. We all adopt a long-term single supply, which may cause the crisis of raw material supply out of stock.
• There is room for missing or no inventory in inventory control.
• The supplier produces the factors of the condition or shipping period during the shipment.

Current implementation measures

1. Establish an inventory center to ensure that there is sufficient storage space and monitoring of the minimum inventory, and maintain close communication channels with suppliers at any time.
2. Master the timeliness of shipping.

Future goal
Evaluate and expand other suppliers.

• Dust causing doubts among residents in surrounding communities.
• The transportation of raw materials into the factory and product shipment may affect the surrounding traffic conditions.

• Trucks for raw materials entering the factory or product shipments are covered or protected by protective covers to prevent dust from escaping.
• Transport vehicles travel on the factory area and nearby roads, and the driving speed is reduced to 20 kilometers per hour to reduce traffic accidents and noise.
• Continue to enter the budget of the four major projects and install monitoring equipment so that the company can monitor emission quality at any time and strengthen environmental protection.
1. Inorganic sludge washing project of calcium chloride workshop.
2. The rain and sewage diversion system of the whole plant.
3. Potassium sulfate plant operation data storage system and attached optical fiber installation project.
4. Hydrochloric acid gas and dust detection instrument and auxiliary cable installation project.

• Sesoda mainly manufactures potassium sulfate fertilizers, which are used in the cultivation and fertilization of crops, considering the fertilization characteristics of potassium sulfate, the requirements of rational fertilization and the good use of water resources. In recent years, we have researched and developed water-soluble potassium sulfate fertilizers and granular potassium sulfate fertilizers. Water-soluble potassium sulfate fertilizer is mainly used to fertilize large areas of crops in water-deficient areas. The use of fertilizers that are fully soluble in water allows crop growers to fertilize while supplementing crop moisture. In addition to saving agricultural manpower, it also educates farmers. The correct understanding of the use of potassium sulfate fertilizer is to understand the importance of saving agricultural water.
• Granular potassium sulfate fertilizer is mainly used for mechanical fertilization. Its granular characteristics can slowly dissolve fertilizer in the soil, allowing crops to absorb slowly, extending the period of fertilizer replenishment, and preventing sudden rainstorms from dissolving the applied fertilizer to take it away, saving crop growers the manpower needed to fertilize multiple times and the effective use of fertilizer.
• In recent years, due to the diversified development of potassium sulfate fertilizer products in response to the needs of the agricultural market, although climate change issues affect the cultivation of crops, the risk is increased, but our products have developed new products in response to changes in fertilization methods, which have turned into opportunities. Water-soluble potassium sulfate fertilizer products account for about 60% of the total potassium sulfate fertilizer product shipments.

• General safety management, training and audit: Sesoda implements various safety and health management operations, such as: process safety and health management, automatic inspection and management methods for machinery and equipment, safety work permit implementation rules, subcontractor management methods, contractor management , Work environment measurement, hazard communication, TPM system inspection, zero disaster rewards and punishment operations, safety and health inspections, etc. safety management and audit.
• Education and training: draw up an annual education and training plan every year, as required by laws and regulations, implement more than three hours of education and training on hazardous materials and hazardous materials per year for operating staff; implement relevant safety and health education and training for employees on the job and drills in emergency situations ; Implement on-the-job training for special operators to ensure that employees abide by laws and regulations.
• Hazardous substance management: In accordance with Article 10 of the Occupational Safety and Health Law, with reference to hazardous chemical labeling and general knowledge rules and specific chemical substance hazard prevention standards, the "3D3-07 Hazard General Knowledge Plan" is formulated to manage and control various dangerous substances And harmful substances. For hazardous chemicals (sulfuric acid, hydrochloric acid), storage tanks, pipelines and pipe valves are marked, and a list is prepared and safety data sheets are disclosed. Liquid barriers and emergency leak alarms are set up around the storage tank area to ensure Manage hazardous chemicals, and complete the report for reference in accordance with the "Designation and Operation Management Measures for Priority Management Chemicals".