Caprolactam Tightens


Caprolactam is an important organic chemical raw material. It
is mainly used to produce nylon 6 engineering plastics and nylon
6 fibers. In addition, caprolactam can also be used to produce
anti-platelet drug 6-aminocaproic acid and laurocapram. It has
extensive applications.

Rapid output increase

China has four caprolactam producers today with a total capacity
of 357 thousand t/a. The project expanding the caprolactam
capacity from 70 thousand t/a to 140 thousand t/a undertaken by
Sinopec Baling Petrochemical Company Ltd. with its own
technology started production in the first half of 2006. The
project expanding the caprolactam capacity from 5 thousand t/a
to 12 thousand t/a undertaken by Zhejiang Juhua Group started
production in December 2006. Owing to the huge market shortage,
some producers plan to construct and expand caprolactam units.
Sinopec Shijiazhuang Chemical Fiber Co., Ltd. is expanding its
caprolactam capacity from 65 thousand t/a to 160 thousand t/a.
Jiangsu Junma Group Co., Ltd. plans to construct a 200 thousand
t/a caprolactam plant in Yangzijiang Chemical Industry Park. The
120 thousand t/a caprolactam project to be jointly constructed
by Cangzhou Chemical Industry Co., Ltd. and Hong Kong Huashida
Chemical Group Co., Ltd. was approved by the National
Development and Reform Commission in July 2006, (CCR2006, No.
23) however, Cangzhou Chemical Industry Co., Ltd. recently
announced that the company has quitted the project due to the
operation and capital problems. There is a rumor that China
Petrochemical Development Corp. of Taiwan province plans to
build a chemical complex in Hebei province and make caprolactam
at the complex. Besides, Sanding Stock-Holding Group Co., Ltd.
plans to construct 500 thousand t/a caprolactam project, but
detail has not been disclosed.  It is expected that the total
capacity of caprolactam in China will reach 770 thousand t/a in
2010.
   With the constant capacity expansion, the output of
caprolactam in China has also kept increasing. Output was 171
thousand tons in 2002, increasing to 228 thousand tons in 2004.
Due to renovations at DSM Nanjing Chemical Co., Ltd., output fell
slightly to 214 thousand tons in 2005. With the completion of
renovation, units started production in 2006 and output reached
291 thousand tons, an increase of 36% over 2005. The average
annual growth of caprolactam output in China was 14.2% from 2002
to 2006.

High import dependence

With the rapid development of polyamide fiber filaments, tire
cord fabrics and nylon engineering plastic sectors, the demand
for caprolactam has grown constantly. The apparent consumption
of caprolactam in China was 736 thousand tons in 2006, an
increase of 4.4% over 2005 and the average annual growth was
10.7% from 2002 to 2006.
   In spite of considerable growth, the output of caprolactam
in China still cannot meet the market demand and great quantities
have to be imported from abroad. Owing to the rapid output growth,
the imported amount of caprolactam in China was reduced to 445
thousand tons in 2006, a drop of 9.7% from 2005.
    China's main use of caprolactam is to produce polyamide
fibers and nylon 6 engineering plastics. The output of polyamide
fibers was 717 thousand tons in 2005, using 606 thousand tons
of caprolactam and accounting for 86.18% of the total
consumption. According to the future development program of the
polyamide fiber sector, it is expected that the demand for
polyamide fiber in China will increase at an average annual rate
of 8.0% from 2005 to 2010 and the demand for caprolactam in
polyamide fiber will reach 900 thousand tons in 2010.
    The consumption of caprolactam in nylon 6 engineering
plastics was 88 thousand tons in 2005, accounting for around
12.5% of the total. It is expected that the demand for
caprolactam in nylon 6 engineering plastics will increase at an
average annual rate of 10% during the next few years and reach
120 thousand tons in 2010. When the demand in other sectors is
considered, the total demand for caprolactam in China will reach
1.04 million tons in 2010. The capacity to produce caprolactam
will however be only 770 thousand t/a at that time.

Table 1  Caprolactam Producers in China in 2006    (thousand
t/a)
Producer                               Capacity    Technology
DSM Nanjing Chemical Co.                140     benzene
Sinopec Baling Petrochemical Co.          140     benzene
Sinopec Shijiazhuang Chemical Fiber Co.    65      toluene
Zhejiang Juhua Group Corporation          12      benzene
Source: CNCIC

Table 2  Supply and Consumption of Caprolactam in China
in Recent Years    (thousand tons)
Year           2002    2003    2004    2005    2006
Output         171     201        228        214     291
Import         320     377        449       493     445
Export         2        1      -       2          -
Consumption    489       577       677     705     736
Source: CNCIC