Source: Bing

Analysis and prospect on PC supply

By the end of 2015, there were five PC manufacturers in China with the total PC capacity of 628,000 t/a, including Covestro AG (Shanghai) (200,000 t/a), Teijin Limited (Zhejiang) (150,000 t/a), Mitsubishi Gas Chemical Engineering-Plastics (Shanghai) Co., Ltd. (100,000 t/a), Sinopec Mitsubishi Chemical Polycarbonate (Beijing) Co., Ltd. (78,000 t/a) and Ningbo Daphoon Chemical Co., Ltd. (100,000 t/a).

Moreover, 65,000 t/a of PC capacity in LUXI Group (Shandong) was put into operation in March 2015, but there is still no actual PC product manufactured. The supply of PC was about 440,000 tonnes in China in 2015, up 35% YoY.

As we could see from the enterprises locations, PC manufacturers are mainly located in Shanghai, Zhejiang, Beijing and Shandong. Shanghai has the most PC capacity of 300,000 t/a, accounting for 43.3% of the total PC capacity in China. Zhejiang comes next, with the PC capacity of 250,000 t/a, accounting for 36.1% of the total.

It is predicted that PC capacity in China would be greatly released in 2015-2018, and after 2015, there would be over 1 million t/a of PC capacity being constructed and put into operation. 800,000 t/a of PC capacity could be put into operation as what it is planned. It is estimated that the PC capacity in China would reach 913,000 t/a in 2017.

Analysis and prospect on PC demand

In 2015, the output of PC was 440,000 tonnes in China in 2015, up 35% YoY. The apparent consumption of PC was 1.655 million, with the CAGR of 5.8% in 2010-2015. PC is often consumed in electronic and electrical industry, automobile industry, plate material industry and barrel industry, together accounting for 87% of the total PC consumption in China.   

The PC consumed in electronic and electrical industry increased obviously. Due to PC’s good and stable electric insulation in a wide range of temperature and humidity, PC is an excellent insulation. In the meanwhile, its flame retardancy and dimensional stability makes it widely used in the electronic and electrical industry.

As for the automobile industry, the demand for PC was quite limited. PC’s good transmittance, impact resistance, weather ability and high hardness makes it widely used in auto lighting system, dashboard and defroster. PC is also applied in the automotive interior and exterior.

When it comes to plate materials industry, the demand for PC fell due to the sluggish real-estate market. The PC consumption in plate materials industry only accounted for 20% of the total demand for PC in China in 2015.

PC barrels are made from food-grade PC to contain purified water, drinking water and mineral water, which is the only kind of qualified container in the drinking water industry in China.  

Impacted by the new media and new recording method, the PC consumption in CD industry only accounted for 6% of the total PC consumption in China in 2015.

It is predicted that the consumption of PC would reach 1.81 million tonnes in 2017.

Analysis and prospect on PC imports and exports

China is a net import country of PC. The import volume of PC was 1.427 million tonnes in China in 2015, decreased by 53,000 tonnes and down 3.6% YoY; while the export volume was 212,000 tonnes, fell by 11,000 tonnes compared to that in 2014.

General trade was the most popular way in China import trading in 2015, with the trading volume of 754,000 tonnes in 2015, accounting for 52.8% of the total PC import volume. Feeding processing trade came next, with the trading volume of 508,000 tonnes, accounting for 35.6% of the total. South Korea, Taiwan China and Thailand are the main importing countries/regions, with the import volumes accounting for 24.5%, 19.2% and 13.8% respectively. Guangdong Province imported the most PC in China, with the import volume taking up 47.6% of the total. Shanghai and Zhejiang Province followed, with the import volume taking up 20.5% and 13.2% respectively.

Feeding processing trade was the major way in China PC export in 2015, with the trading volume accounting for 88.5% of the total export volume. Shipping origins mainly located in Guangdong Province, with the trading volume accounting for 45.3% of the total; and the trading volume in Shanghai and Zhejiang Province took up 42.6% and 10.2% respectively. The major export destinations were Hong Kong China, Taiwan China and Japan, with the trading volume accounting for 64.9%, 9.4% and 8.5% respectively.

Analysis and prospect on PC market price

China PC market was impacted by the global economy in 2015. Take the price of Covestro polymer 2805 for an example, the peak was RMB19,938/t in Jan. 2015 while the bottom was 16,819/t in Sep. 2015. The average price was RMB18,421/t in 2015.

It is predicted that the PC capacity in China would be greatly released in 2015-2018, and after 2015, there would be over 1 million t/a of PC capacity being constructed and put into operation. 800,000 t/a of PC capacity could be put into operation as what it is planned.

With release of new capacity, competitions with the importing countries/regions, and slow growth in downstream apparent consumption, the operation rate sees an upward trend. It is predicted that the average operation rate in China would fall below 70%.  

*The article is edited and translated by CCM. The original one comes from Economic Analysis of China Petroleum and Chemical Industry.

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