China Targets Deadly Underground Chemical Operations Amid Surge in Explosions
Listen to the full version

Chinese authorities are escalating a crackdown on a deadly surge of clandestine chemical manufacturing, as soaring market prices for pesticide ingredients drive rogue operators to set up highly explosive, unregulated factories.
Since last year, fluctuations in the chemical market and the lure of extreme profits have prompted illicit companies to take massive risks, resulting in a severe resurgence of fatal industrial accidents in the country. In response, the State Council Work Safety Committee and the Ministry of Emergency Management have deployed targeted countermeasures — including specialized inspections, top-level supervision, and public exposure — to systematically dismantle these black-market operations.
Unlock exclusive discounts with a Caixin group subscription — ideal for teams and organizations.
Subscribe to Save an extra $50. Introductory offer for new readers. Subscribe now.
- DIGEST HUB
- Chinese crackdown on illegal factories producing explosive 2-nitro-3-methylbenzoic acid for pesticides, driven by high prices.
- Deadly explosions: Jul 23, 2025 Henan (3 killed, 5.87M yuan loss); Feb 7 Shanxi (8 killed).
- Measures: inspections, AI monitoring, adding to hazardous list, whistleblower rewards up to 400,000 yuan.
1. Chinese authorities are intensifying efforts to curb a deadly rise in illegal chemical manufacturing driven by high pesticide ingredient prices, leading to explosive unregulated factories [para. 1]. Market fluctuations and profit motives since last year have spurred fatal accidents, prompting the State Council Work Safety Committee and Ministry of Emergency Management to launch inspections, supervision, and exposures [para. 2].
2. Liu Li, deputy director at the Ministry of Emergency Management, highlighted profit-chasing without safety at an April 22 news conference [para. 3]. The price surge of 2-nitro-3-methylbenzoic acid (also 3-methyl-2-nitrobenzoic acid), a pesticide raw material prone to explosive nitration, fueled illicit production by untrained operators lacking safety measures [para. 4][para. 9]. Explosions occurred in Xinxiang, Henan on July 23, 2025, and Shuozhou, Shanxi on Feb. 7 [para. 4].
3. This compound is key for chlorantraniliprole insecticide used on rice, corn, and cotton [para. 5]. The China Crop Protection Industry Association on Feb. 10 urged stricter oversight, citing safety risks, market disruption, and threats to sustainability from illicit production [para. 5].
4. The July 23, 2025, Henan blast at Huojia County Daxin Chemical killed 3, injured 2, with 5.87 million yuan ($860,000) losses [para. 7]. Caused by illegal subleasing to Xinxiang Dayuan Petrochemical, which misused permits, retrofitted equipment including six secondhand kettles, and performed prohibited hot work amid regulatory failures; they produced the compound covertly since July 2023 [para. 7][para. 8].
5. The Feb. 7 Shuozhou explosion at Jiapeng Biological Technology, disguised as a feed plant, killed 8, injured 3, producing the same chemical [para. 10]. State Council oversight demanded criminal accountability [para. 10].
6. Illicit operations evade detection by hiding in border zones, abandoned sites, or rural areas, disguising activities, or being nomadic [para. 12][para. 13]. A Jan. 20, 2024, Juancheng, Shandong blast from 3-chloropropyne production killed 7, caused 9.8985 million yuan losses; the operation moved across two provinces and three sites [para. 13]. Networks link suppliers, experts, landlords, vendors, and buyers, requiring multi-agency coordination [para. 14].
7. Countermeasures include grassroots grid monitoring, big data/AI for supply chain anomalies, and harsh prosecutions [para. 15]. On April 16, 10 agencies added five chemicals including 2-nitro-3-methylbenzoic acid and 3-chloropropyne to the Hazardous Chemicals Catalog for strict licensing [para. 16]. Awareness campaigns and rewards up to 400,000 yuan in Shandong encourage whistleblowers [para. 17].
- Huojia County Daxin Chemical Co.
- Huojia County Daxin Chemical Co. in Laocun, Henan, exploded on July 23, 2025, killing 3, injuring 2, with 5.87 million yuan ($860K) losses. Caused by illegal subleasing to Xinxiang Dayuan Petrochemical Trade Co., who used its permits to covertly produce explosive 3-methyl-2-nitrobenzoic acid via unsafe hot work. Local regulatory failures contributed.
- Xinxiang Dayuan Petrochemical Trade Co.
- Xinxiang Dayuan Petrochemical Trade Co. illegally used Huojia County Daxin Chemical Co.'s permits since July 2023 to covertly manufacture chemicals, evading checks. In 2024, it bought and modified six secondhand reaction kettles. On July 23, 2025, an explosion during 3-methyl-2-nitrobenzoic acid production killed 3, injured 2, causing 5.87 million yuan losses.
- Shanxi Shuozhou Jiapeng Biological Technology Co.
- On Feb. 7, an explosion at Shanxi Shuozhou Jiapeng Biological Technology Co. killed 8 people and injured 3. Officially registered as an animal feed producer, it secretly manufactured the explosive 2-nitro-3-methylbenzoic acid. The State Council Work Safety Committee oversaw the investigation, demanding accountability.
- PODCAST
- MOST POPULAR





