May 19, 2024

Polypropylene development in China needs to take advantage of the situation

With the spread of the global financial crisis, the global excess pressure on the polypropylene market is increasing. How should China face it? Industry insiders believe that this is a great opportunity for China to develop polypropylene. It should take advantage of the situation, accelerate the pace, become bigger and stronger, and strive to achieve results in the three to five years to establish the power of China's polypropylene in the international community. leading position.
Increased international status In 2007, the global polypropylene production capacity reached 46.982 million tons, and the market consumption reached 44.351 million tons. The total production capacity of polypropylene in China has reached 6.91 million tons. It is the second largest producer in the world after the United States. It has basically formed a solvent method, a liquid-phase bulk-gas-phase method, an intermittent liquid-phase bulk method, a gas phase method, etc. A variety of production processes are concurrently adopted, and production patterns with large, medium, and small production modes coexist. At present, China's polypropylene production comes from about 40% of ethylene joint production companies, and about 60% of the production of propylene from the refinery as raw materials.
China is a major consumer of polypropylene, and the rapid growth of the consumer market has brought about a new upsurge of industrial investment in polypropylene. It is estimated that around the year 2010, China's polypropylene industry will enter a new round of investment peak period, and nearly 6.8 million tons of production capacity will be gradually put into operation (including projects under construction and expansion). Among these new installations, with the exception of a few sets of 200,000 tons, the vast majority exceeded 300,000 tons, reaching a world-class scale and capable of resisting risks. If these projects under construction can all be put into production on schedule, the polypropylene production capacity in China will reach 13 million tons in 2010.
The problem should not be overlooked. It should be noted that polypropylene in China still has problems such as small scale of production, low level of intensification, low product grade, and low added value. The technical level and production capacity of the polypropylene industry still have a certain level compared with the advanced level in foreign countries. gap
As the consumption of polypropylene in the country has grown rapidly, and the growth rate of production has been relatively small, it has led to the supply of generic grade resins, while the high and mid-range products have been vacant. Foreign manufacturers, which occupy a monopoly position in the high-end market and some mid-range markets, will continue to expand their exports to China by virtue of their geographic and low-cost advantages. Polypropylene plants in China are usually built together with ethylene plants and refineries. Most of them are small and medium-sized devices, and the device layout is too scattered. The polypropylene produced by the northern device, except for some goods processed in-situ woven products, was transported by the south and the transportation cost was too high. The Pearl River Delta market is basically saturated, and the market potential of the Yangtze River Delta is limited. In order to seize opportunities, some downstream polypropylene processing companies have shifted their strategies to the north, but the northeast and northwest markets are still far from being “strengthened and bigger”. Due to fierce competition, it is inevitable for the polypropylene industry to reshuffle and the gradual exit of small and medium-sized devices from the production field will become an inevitable outcome.
Accelerate development to meet challenges At present, the global polypropylene market will face enormous pressure from surplus. The Middle East has become a hot spot for new polypropylene projects. After several large-scale export-oriented devices in the Middle East are put into operation, cheap products will flow into the country in large quantities and will gradually replace the traditional export giants such as Korea and Japan. There will also be a strong impact. The new polypropylene capacity under construction and expansion in China will soon be put into production, and the market supply will increase rapidly. The increase in new energy production capacity and the reorganization of the industry have intensified, but at the same time, the raw material costs of enterprises are still high, which will force companies to reduce the operating rate, and the profitability of the entire polypropylene industry will also be affected differently. As the new production capacity is too concentrated, the market will focus on digesting the capacity formed during the peak of expansion, and the competition will enter a white-hot state. In this regard, China's polypropylene industry must accelerate development to meet the challenges.
First, we must step up the construction and expansion of polypropylene projects to meet domestic consumption. Since 2008, the successful commissioning of polypropylene, such as Zhongyuan Petrochemical and Maoming Petrochemical, and the large-scale enterprises in Ningxia Refining and Petrochemical Co., Ltd. have opened a new round of construction and expansion projects, promoted the localization of polypropylene, improved the quality of products, and expanded Polypropylene production upgrades have reached a world-class scale, which has increased the overall advantages of the project and its ability to resist risks.
From the perspective of production capacity, the vast majority of Sinopec's new production capacity has radiated to the Pearl River Delta, the Yangtze River Delta, and the Bohai Rim. PetroChina's equipment is built entirely in the northeast old industrial base and northwestern development area.
Second, stepping up industry restructuring and mergers and acquisitions among enterprises have prompted China Chemical to win the market competition. Domestic chemical companies should rely mainly on increasing production scale and improving production efficiency to reduce production costs. They can promote the rapid development of domestic chemical companies through the restructuring of mergers and acquisitions in the industry, and change the previous situation of high cost. That is to develop into an upstream supplier, reduce procurement and marketing costs; use technology innovation to reduce product costs; use the increase in production scale to reduce product environmental costs.
Third, expand international export trade. At present, the focus of the global polypropylene market is shifting eastward. China’s close neighbors, India and China, will become the driving force behind the global growth in polypropylene consumption. In recent years, the Indian economy has seen rapid growth and rapid growth in disposable income, which has greatly stimulated the growth of consumption. India is also one of Asia's huge markets for automobiles, all kinds of utensils and packaged foods, and India is making great efforts to improve infrastructure. All this has stimulated strong growth in polypropylene consumption, and there will be a large number of imported polypropylene derivatives. China's polypropylene industry needs to accelerate its growth and use neighboring countries to expand its international export trade.

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