DMF Faces Fierce Competition   

By Wang Lei   

Dimethyl formamide (DMF) is an important chemical raw material and also a solvent with excellent property. It is mainly used in polyurethane, acrylic fiber, pharmaceutical, pesticide, dyestuff and electronic sectors. Stimulated by the downstream consumption, the capacity of to make Dimethyl formamide (DMF) in China has expanded rapidly in recent years and China has become a major DMF producer in the world.

Imported amount has reduced remarkably

Due to the sustained capacity growth, the imported amount of DMF in China has reduced constantly since 2004. The imported amount was 49 thousand tons in 2006, a drop of 41.6% from 2005.
   DMF used in sizing agents is mainly from domestic suppliers today. Application sectors for DMF imported from abroad are getting narrow. Imported DMF is mainly used in the electronic sector with relatively stable demand.
   Korea was the largest DMF supplier for China in 2006 and the amount imported from Korea accounted for 53.3% of the total. The proportion was 18.5%, 14.2% and 7.2% respectively for Taiwan province, Japan and Germany.
    The overall distribution of DMF consumption in China has had no great changes in recent years. The sizing agent sector is still the major application sector. The electronic sector holds the second place. The consumption in acrylic fiber, pharmaceutical and pesticide sectors has basically kept stable.

The capacity has expanded constantly

Since 2004 the supply of DMF in the domestic market has been based on domestic products with imports as supplement. The proportion of imports is getting smaller. Major domestic suppliers include Zhejiang Jiangshan Chemical Co., Ltd. and Hualu Hengsheng Chemical Co., Ltd.
   The production capacity of DMF in China saw the most rapid expansion in 2005. In the first half of 2005 the production capacity of the DMF unit in Henan Anyang Jiutian Group was expanded to 30 thousand t/a, the capacity of the 80 thousand t/a DMF unit in Hualu Hengsheng Chemical Co., Ltd. was expanded to 150 thousand t/a and the 40 thousand t/a DMF unit in BASF-YPC Co., Ltd. started production. (CCR2005, No. 20) In 2006 the 40 thousand t/a DMF unit in Zhangqiu Riyue Chemical Co., Ltd. started production and the total capacity of DMF in China reached 525 thousand t/a. There will be more capacity expansion in 2007. A 80 thousand t/a DMF unit in Hualu Hengsheng Chemical Co., Ltd. will be completed and put into operation in the third quarter of 2007. A 100 thousand t/a DMF unit in Henan Anyang Jiutian Group will be put into production in the second half of 2007. Another 40 thousand t/a DMF unit in Zhangqiu Riyue Chemical Co., Ltd. is under construction today and will be completed in 2007. A 40 thousand t/a DMF unit in Henan Haotian Junhua Group is also under construction. The construction of the 30 thousand t/a DMF unit in Jiangsu Xinling Chemical Co., Ltd. has already completed, the unit is in the debugging stage and has not had commercial production. It is expected that the capacity of DMF in China will be more than 800 thousand t/a at the end of 2007.

It is imperative to expand overseas markets

The growth of both the capacity and the output in the sizing agent sector has gradually slowed down in recent years. It is expected that the capacity of sizing agents in China will be 1.1 million-1.2 million t/a in 2007, consuming around 480 thousand tons of DMF. If all the new DMF units start production soon, the capacity of DMF in China will be in surplus and the competition in the domestic market will become fiercer. Improving product quality and expanding overseas markets will therefore be the orientation for the development of the DMF sector in China.

Major DMF Producers
  in China in 2006   (thousand t/a)
Producer                        Capacity
Zhejiang Jiangshan Chemical Co.    150
Hualu Hengsheng Chemical Co.    150
Anhui Huaihua Group Co.           40
Zhangqiu Riyue Chemical Co.        40
BASF-YPC Co.                      40
Henan Anyang Jiutian Group        30
Jiangsu Xinling Chemical Co.    30
Jiangsu Xinya Chemicals Co.       15
Source: CNCIC