China's ABS Industry Needs to Change Its Monotonous Product Structure   

By Wu Xiaoyin, Sinopec Chemicals Sales Company East China Branch

China's output of ABS resins ranks first in the world, but high-end products is in short supply.

With the continuing improvement of domestic macroeconomic situation and the constant tight supply of energy and raw materials, ABS has always been in short supply, and its production capacity has grown rapidly, of which the joint-venture ABS capacity develops fastest. By the end of 2010, China's ABS capacity and annual output had reached 2.57 million t/a and 1.9 million tons, respectively, both ranking first in the world (see Table 1). China's major ABS producers and their capacity in 2010 are listed in Table 2.

Table 1  China's ABS production capacity and output (thousand t/a, thousand tons)
Year          Capacity         Output
2006    1850    1350
2007    2180    1750
2010    2570    1900

Table 2 China's major ABS producers in 2010     (thousand t/a)
Producer    2009    2010
LG Yongxing     500    600
Chimei (Zhenjiang)    300    400
Zhenjiang Grand Pacific    250    250
Formosa Chemicals (Ningbo)    250    250
Shinho (Changzhou)    80    80
Jilin Petrochemical    190    190
Panjin Ethylene    50    200
Daqing Petrochemical    150    150
Lanzhou Petrochemical    50    50
Gaoqiao Petrochemical    200    200
Tianjin Dagu Chemical Co Ltd    -    200
Total    2020    2570

   During 2011 - 2013, ABS producers in China will further enhance their ABS capacity, and the total new capacity is expected to reach 950 000 t/a, as listed in Table 3.

Table 3 New ABS capacity in China during 2011 - 2013        (thousand t/a)
Company    New capacity    Startup time    Location
LG (Guangdong)    300    2012    Huizhou, Guangdong province
Formosa Chemicals (Ningbo)    100    2012    Ningbo, Zhejiang province
Shanghai Huayi Group    50    2011    Shanghai
Tianjin Dagu Chemical Co Ltd    200    2012    Tianjin
Jilin Petrochemical    300    2013    Jilin City

   Although China has become the world's largest ABS producer and consumer, its ABS industry is still in the extensive development stage, featuring backward technologies, a monotonous product structure and little standardization. These make most of ABS products, especially high-performance ABS products, in China have to be imported from abroad for a long time. In particular, the supply of high-performance ABS products is becoming tight year by year in the country. Despite the rapid growth of its ABS production capacity and output, China still imports a large amount of ABS products each year, having a high dependence on imports. In 2010, China imported 2.1 million tons of ABS and exported 60 000 tons. The country's imports and exports of ABS during 2006 - 2010 are listed in Table 4.

Table 4 China's imports and exports of ABS (thousand tons)
Year    Import volume    Export volume
2006    2015    20
2007    2173    32
2008    1952    40
2009    2168    50
2010    2100    60


Table 5 China's consumption of ABS     (thousand tons)
Year    Apparent consumption    Annual growth /%    Self-sufficiency rate /%
2006    3345    9.50    40.38
2007    3619    8.19    39.98
2008    3263    -9.83    40.18
2009    3666    12.35    40.85
2010    4000    9.11    42.98


Consumption is concentrated in East and South China, and demand will continue to grow fast.

In China, the consumption of ABS is mainly concentrated in the country's south and east regions. South China accounts for 48% of the national total ABS consumption, and East China accounts for 43% (see Figure 1).
   During the "Eleventh Five-Year Plan" period (2006-2010), the rapid development of electronic information, automobile and real estate industries and the improvement of residents' consumption level in China brought a huge space for the development of synthetic resins. In 2010, the apparent consumption of ABS in China reached 4 million tons. By 2015, it will reach 4.9 million tons, having an average annual growth rate of 6% during 2011-2015. China's consumption of ABS during 2006 - 2010 is listed in Table 5.
   For a long time, ABS has mainly been applied in refrigerators, TV sets, telephones, office supplies and other electronic and electrical accessories, which account for about 80% of the total consumption in China. In recent years, the focus of ABS consumption in China has gradually shifted to other new areas. The fast development of automotive and electronics industries has brought the ABS market a new layout. Due to the oversupply of TV sets, washing machines and other household appliances in China and the penetration and coverage of alternatives such as polypropylene in the household appliances market, the application of ABS in large household appliances is decreasing, but its use in small household appliances and office equipment and transportation areas is rising. It is expected that the application of ABS in the field of transportation will have great potential. The rapidly rising production and consumption of automobiles and motorcycles will make car interior products become the big new consumer market for ABS. The popularity of yachts, moving houses and other leisure supplies will open up a new sales space for ABS. In addition, the application of ABS in pipes and fittings, building materials, medical devices and alloys also has good market prospects.

Four major problems block the development of the ABS industry.

With the domestic wide applications, the demand for ABS in China continues to grow, strongly promoting the development of the ABS industry. However, the country's ABS industry is still facing many problems now.
    (1) Shortage and high costs of raw materials. Although PetroChina and Sinopec have newly build or expanded a number of styrene and acrylonitrile plants, most of the plants are supporting units of their polystyrene, styrene-b