Acrylic Acid and Esters Will Be Oversupply   

By Zheng Chengwang

Due to the drastic capacity expansion, acrylic acid and esters will be oversupply.

Drastic capacity growth

The production capacity of acrylic acid in China has grown drastically in recent years. With the completion of the 80 thousand t/a acrylic acid and 130 thousand t/a acrylic ester project in Shenyang Paraffin Chemical Industrial Co., Ltd., (CCR2006, No. 31) the capacity of acrylic acid in China has reached 882 thousand t/a. Because of the evident capacity surplus, the operating rate of acrylic acid units in China will reduce constantly in the next 1-2 years.
   The output of acrylic acid in China was 513 thousand tons, the net imported amount was 33 thousand tons and the apparent consumption was 546 thousand tons in 2006. The consumption of acrylic acid in the production of various acrylic esters was 460 thousand tons, accounting for 84.2% of the total. The output of various acrylic esters was around 770 thousand tons. Acrylic esters are mainly used in adhesive, coatings and leather sectors. The variety with the greatest consumption was butyl acrylate. The imported amount of acrylic esters in China was 123 thousand tons in 2006, a drop of 33.9% from 2005.

Imported amount decreased drastically in 2006

The imported amount of acrylic acid and esters in China grew rapidly in the 10 years from 1995 to 2004. It reached 356 thousand tons in 2004, an increase of 10.9% over 2003. In 2005 the imported amount had the first negative growth in the 10 years with a drop of 19.3% from 2004. It showed that the output of acrylic acid and esters in China had a drastic increase. The imported amount in 2006 further reduced to 176 thousand tons, a drop of 38.7% from 2005.
   Due to the rapid output increase, the market price of acrylic acid and esters in China dropped in 2006. The average price of acrylic acid and butyl acrylate in Shanghai market was RMB13 520/t and RMB14 655 /t in 2006, a drop of 36.8% and 19.8% respectively from 2005.

Sustained capacity expansion in 2007

The price of acrylic acid and esters in China had a slow reduction at the beginning of 2007 and started to pick up in April 2007 but still failed to reach the price level of the beginning of 2007 in May. It is expected that the overall market price will present a rising trend, but the growth will not be big. The price of methyl acrylate will be relatively stable and the price of butyl acrylate will have a slow drop from the relatively high level.
   The production capacity of acrylic acid and esters in China will have a further growth in 2007. The 80 thousand t/a acrylic acid and 110 thousand t/a acrylic ester project in CNPC Lanzhou Petrochemical Co., Ltd. will put into operation in October 2007. The 80 thousand t/a acrylic acid and 120 thousand t/a acrylic ester project in Shandong Zhenghe Group will also likely start production in 2007. The 17 thousand t/a special acrylic ester project in Sartomer (Guangzhou) Chemical Company Ltd. started construction in Nansha Development Zone, Guangzhou, Guangdong province in mid-March 2007. (CCR2007, No. 10)
   Faced with the drastic capacity expansion of acrylic acid and esters, the acrylic acid sector in China should strengthen the development of downstream products and expand their application scope so as to effectively ease the oversupply of acrylic acid and esters.

Table 1  Output in Major Acrylic Acid and Ester Producers
            in China in 2006   (thousand tons)
Producer                          Acrylic acid    Acrylic esters
Beijing Dongfang Petrochemical Co.           80            94
CNPC Jilin Petrochemical Co.                 30           36
Shanghai Huayi Acrylic Acid Co.              111           135
Zhejiang Satellite Chemicals                  13            16
　(Enterprise Group)
Formosa Acrylic Esters (Ningbo) Co.            86            104
BASF-YPC Co.                                  108            130
Jiangsu Yulang Chemical Co.                    75            60
Shenyang Paraffin Chemical Industrial Co.    6            6
Source: CNCIC


Table 2  Import and Export of Acrylic Acid and Esters
       in China in Recent Years   (thousand tons)
Year
             Import               Export
        AA      AE    Total    AA    AE    Total
2001    67      182    249      1    15    16
2002    109      189    298     1    11    12
2003    110     211    321     1    18    19
2004    114     242    356     3    32    35
2005    101     186    287     9    73    82
2006    53      123    176     20    56    76
AA= Acrylic acid
Ae= Acrylic esters
Source: CNCIC