ABS Supply Falls Short
By Yu Chunmei and Han Ye

China's new capacity to produce acrylonitrile-butadiene-styrene resin (ABS) in 2009 was 250 000 t/a, bringing the total capacity to 2.26 million t/a. The output was 1.785 million tons, an increase of 210 500 tons over 2008. Through several years' expansion, the combined ABS capacity of some foreign companies in China such as LG Chem, Chi Mei Corporation, Formosa Plastics Corporation and Grand Pacific Petrochemical Co., Ltd. accounts for 70% of China's total. It can be seen that foreign companies already hold a leading position in the Chinese market.
    With the basic trend of the economy rehabilitation and the gradual restoration of the domestic market, plans for the construction and expansion of ABS units came back one after another in 2009. After the completion of the 100 000 t/a expansion project of Zhenjiang Chi Mei Chemical Co., Ltd. and the 150 000 t/a expansion project of Liaoning Huajin Chemical Industry Group at the end of 2009, four new units including that of Shanghai Huayi Group (200 000 t/a), Tianjin Dagu Chemical Co., Ltd. (400 000 t/a), PetroChina Jilin Petrochemical Company (400 000 t/a) and CNOOC (Huizhou, 300 000 t/a) totaling 1.30 million t/a in capacity will also start production during 2010-2013. China's capacity of producing ABS will reach 3.56 million t/a in 2013.

China's ABS Producers as of 2009
Producer                                 Capacity    Output
                                                                                      (thousand t/a)   (thousand tons)
PetroChina Lanzhou Petrochemical Co., Ltd.    50      16.1
PetroChina Jilin Petrochemical Co., Ltd.    180      175.7
Zhenjang Chi Mei Chemical Co., Ltd.         450     275.6
PetroChina Daqing Petrochemical Co., Ltd.    105     110.3
Liaoning Huajin Chemical Industry Group     150      0
Panjin Shuangxing Engineering Plastics Co., Ltd.    50      4.1
Zhenjiang Grand Pacific Chemical Co., Ltd.    250     192.2
Ningbo LG Yongxing Chemical Co., Ltd.       500     540
Shinho (Changzhou) Petrochemical Co., Ltd.    75      53.0
Formosa Plastics (Ningbo) Co., Ltd.            250     262.8
Sinopec Shanghai Gaoqiao Petrochemical Co., Ltd.    200     155.3
Total                                       2 260    1 785.1
Source: CNCIC

China's Production and Consumption of ABS between 2000 and 2009
Year    Capacity    Output    Imports    Exports    Consumption
         (thousand t/a) (thousand tons) (thousand tons) (thousand tons) (thousand tons)
2000    485     299     1 351    281  622    18.4
2001    585     400     1 426    291  797    22.3
2002    1 018    569     1 638    202  187    26.0
2003    1 080    928     1 790    212  697    34.4
2004    1 130    1 018    1 963    162  965    34.3
2005    1 170    1 096    1 987    143  069    35.7
2006    1 790    1 184    2 015    183  181    37.2
2007    1 862    1 774    2 173    323  915    45.3
2008    2 005    1 574    1 952    433  483    45.2
2009    2 260    1 784    2 168    503  902    45.7
Source:

ABS in China is mainly consumed in small household electric appliances, large household electric appliances, light industry products and automobiles.

China is the biggest producer and consumer of household electric appliances worldwide. With the oversupply in the consumption market of large household electric appliances such as television sets and washing machines and the penetration of substitutes such as modified polypropylene (PP) and some high impact polystyrene (HIPS) with good property and gloss, the consumption of ABS in large household electric appliances is falling year-on-year. The consumption of ABS in large household electric appliances accounted for 31% of the total in 2009.
   Along with the spread of ideas advocating the modernization of houses and kitchens, the demand for ABS in small household electric appliances is on the rise. The demand is nearly equal to the demand in large household electric appliances today. The consumption proportion of ABS in office equipment and small electric appliances will further increase in the future.
   China is the biggest producer and exporter of cases, bags and toys in the world. The growth of ABS consumption in light industry products such as cases, bags and toys has kept brisk in recent years. The demand for ABS in light industry products is greatly influenced by the export conditions. The change of the ABS consumption mix in China will mainly be determined by the export situation.
   The communication and transportation sector is a potential consumption sector of ABS. With the construction of plants in China by foreign automobile giants, the output and the consumption of automobiles and motorcycles will enjoy a drastic growth. A broad market will be opened up for the application of ABS special types. Interior trimming parts of automobiles will become a new growing point for the ABS consumption. According to China Automobile Industry Association, the sales amount of new automobiles in China was 13.0 million units in 2009 and is expected to rea