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The competition in the polycarbonate market will become increasingly fierce in the next two years


Date:

2017-06-01

Covestro announced on May 16, that the capacity of Shanghai polycarbonate (PC) will be further expanded to 600,000 tons/year, breaking through the bottleneck, and the new capacity will be put into operation in 2019. This will enhance the Covestro's status of global dominance in PC resin industry. At that time, the competition will be more intense in the domestic market.

Covestro announced on May 16, that the capacity of Shanghai polycarbonate (PC) will be further expanded to 600,000 tons/year, breaking through the bottleneck, and the new capacity will be put into operation in 2019. This will enhance the Covestro's status of global dominance in PC resin industry. At that time, the competition will be more intense in the domestic market.

PC is featured by light weight, high transparency, good impact resistance and easy-to-shape performance, which is used in a variety of areas of modern life: electronic and IT equipment, auto parts, medical equipment and LED lighting. Since 2005, a wave of PC investments has been initiated in China. World-class manufacturers such as Teijin, Mitsubishi, Bayer and so on have set up factories in China. As Covestro doubled Shanghai's production capacity to 400,000 tons/year in October 2016, and the Phase I Project of Luxi Chemical was put into operation at the end of the year, as of the end of 2016, China's PC production capacity has reached nearly 900,000 tons/year, and the output has exceeded 600,000 tons. Although it has been greatly improved, it is far from meeting the domestic demand. In that year, the self-sufficiency rate was still less than 40%, and the import was about 132 million tons. Although it has a slight decline compared with the previous year, the imports has remained as high as 1.3 million tons over the past five years. China's demand for PC is still growing rapidly at the rate of 8% to 12% per year. In the future, there is a broad space for development. The Ministry of Industry and Information Technology organized the work to find alternatives to the import of chemical new materials, and PC is also included. Therefore, domestic PC enterprises have shown a good momentum of development in recent years. Most of them have launched and expanded projects.

The next two years is the period of production capacity centralized release for the Chinese PC industry. In addition to the latest announcement of the expansion project of Covestro, in 2017 and beyond, there will be more than 1 million tons/year of PC plants to be invested, proposed to be constructed or in the research phase, including the new 260,000 t/y PC plant to be jointly set up at the new plant area of Tianjin Petrochemical by Sinopec Corp and SABIC. The project is under construction and is expected to be put into operation in 2017-2018; Tongling Nonferrous Metals Group plans to put in a set of 100,000 tons/year PC device; Shandong Lihuayi laid the ground for the 100,000 tons/ year PC device in early March 2017; Qingdao Hengyuan is building a new 100,000 tons/ year PC device; Luxi Chemical's PC Phase I Project has been put into production and has been running stably, and the company prepares to build two production lines of the Phase II Project; Wanhua Chemical's PC unit is expected to be put into operation in the second quarter of 2017; Zhejiang Petrochemical's refining and petrochemical integration project of 40 million tons also includes two phases of PC projects with total capacity of 520,000 tons/yea……

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