Ethylene Glycol Ether Is toward Integrated Development

By Qin Yisheng, Jiangsu Tianyin Chemical Industry Co., Ltd.

Ethylene glycol ether, which is one of important derivatives of ethylene oxide, has increasingly wide applications and can be used in the sectors like coatings, ink, cleaning agent, leather dyeing, dyestuff, automobile brake fluid, antifreeze and polyvinyl chloride (PVC) stabilizers, etc. Among which, coating solvent is the largest consumption sector of ethylene glycol ether. In recent years, among ethylene glycol ether series products, ethylene glycol monobutyl ether with relatively large market demand has better market prospects. In addition, among ethylene glycol ethers, a new-type polyether for the production of polycarboxylate high performance concrete water reducing agents has achieved rapid development.

A  Domestic ethylene glycol ether production cannot meet the actual demand

In recent ten years, the global capacity to make ethylene glycol ether has always maintained at around 2.5 million t/a, and the average operating rate of the units has been around 50%. The United States, Western Europe and Japan have been the major production and consumption countries and regions of ethylene glycol ether in the world. Currently China’s demand for ethylene glycol ether grows rapidly, and there exists a certain supply gap, offering a certain market space for the development of ethylene glycol ether in China.
   During 2002-2007, China’s import volume of ethylene glycol ether increased stably. Due to the global financial crisis, both the import volume and export volume of ethylene glycol ether in China reduced in 2008. In 2009 China’s import volume of ethylene glycol ether had a significant year-on-year growth. In 2010, with the stable development of China’s economy, the import volume reached around 146 thousand tons, up 20.7% year-on-year. Among the imported ethylene glycol ether, the import volume of ethylene glycol monobutyl ether accounted for more than 90%.  China’s import volume of ethylene glycol monobutyl ether (including diethylene glycol monobutyl ether) reached 132 thousand tons and 138 thousand tons, respectively in 2010 and 2011.

B Private enterprises dominate China's ethylene glycol ether production

At present, Dow Chemical is the largest ethylene glycol ether producer in the world and has production units in the United States, Germany, Argentina and China, with a combined capacity of 754 thousand t/a. Dynamic International Enterprises Limited is China’s largest ethylene glycol ether producer with a total capacity of 200 thousand t/a, ranking the fourth in the world.
   In recent 30 years, the production and consumption of ethylene glycol ether products in China have developed rapidly. China’s consumption of ethylene glycol ether accounts for 21% of the world total now, and China will become the country with the fastest consumption growth of ethylene glycol ether in the world.
   In China, private enterprises dominate the production of ethylene glycol ether. After many years of competition in the same sector and the impact of the imported products, China has several enterprises with a capacity of more than 10 thousand t/a, and the technical level has also improved significantly.
   In the next few years, the newly added capacity to make ethylene glycol ether in the world is mainly concentrated in Asia. A large number of ethylene glycol ether projects will be constructed or planned for construction in China during 2012-2015, and it is expected that the newly added capacity will be more than 300 thousand t/a before 2013.
   
Table 1 China’s ethylene glycol ether producers in 2011
Producer    Capacity (kt/a)
Dynamic (Nanjing) Chemical Co., Ltd    175
Jiangsu Tianyin Chemical Industry Co., Ltd    25
Jiangsu Yida Chemical Co., Ltd    25
Jilin Yida Chemical Co., Ltd    30
Jiangsu Hualun Chemical Industry Co., Ltd    10
Shanghai Jinshan Chemical Co., Ltd    10
Liaoning Kelong Fine Chemical Co., Ltd    10
No.3 Petrochemical Factory of Tianjin Petrochemical Co., Ltd    3
Total    288
Note: Excluding polycarboxylic acid polyether.

Table 2 China’s newly added capacity of ethylene glycol ether during 2012-2013
Producer    Capacity (kt/a)    Startup time
Dynamic (Nanjing) Chemical Co., Ltd    70    2012
Jiangsu Yida Chemical Co., Ltd    15    2012
Jiangsu Hualun Chemical Industry Co., Ltd    50    2012
Dynamic Chemical Industry Binhai Co., Ltd    10    2012
Ningbo Juhua Chemical & Science Co., Ltd    60    2013
Note: Excluding polycarboxylic acid polyether.

Table 3 China’s production of commercial ethylene oxide
Year    Capacity (kt/a)    Output (kt)
2007    588    600
2008    648    600
2009    881    721
2010    1 083    950
2011    1 336    1 115


C  Future development trend of ethylene glycol ether

1. Ethylene glycol monomethyl (monoethyl) ether has been gradually replaced by propylene glycol ether

In China, the consumption of ethylene glycol monomethyl ether is not big. The capacity to make ethylene glycol monoethyl ether (EE) was 60 thousand t/a in 2003 and reduced to 45 thousand t/a in 2010 with an average annual negative growth of 4%. The domestic ethylene glycol monoethyl ether acetate (CAC) capacity was 60 thousand t/a in 2003 and decreased to 40 thousand t/a in 2010 with an average annual negative growth of 6%. Whereas China’s capacity to make propylene glycol methyl ether (PM) was 33 thousand t/a in 2003 and reached 116 thousand t/a in 2010 with an average annual growth of 20%, and the propylene glycol monomethyl ether acetate (PMA) capacity was 42 thousand t/a in 2003 and reached 110 thousand t/a in 2010 with an average annual growth of 15%. These show that PM and PMA have gradually replaced EE and CAC.

2.  Demand of ethylene glycol monobutyl ether is growing

Ethylene glycol monobutyl ether is usually used as the solvent for coatings, printing, ink and resin, metal detergent, paint remover, lubricant remover, automotive engine detergent, dry cleaning solvent, epoxy resin solvent and drug extraction agent. It is also used in latex paint stabilizer, evaporation inhibitor for automotive coatings and aircraft coatings, and the surface processing for high temperature baking enamel, etc.
   In recent years, due to the rapid development of China’s coatings sector, the replacement of oil-based coatings by water-based coatings has become an inevitable trend, and the demand for ethylene glycol ether products, especially ethylene glycol monobutyl ether, has grown greatly. In 2011 China produced 11.8 million tons of coatings (paints), up 19.8% year-on-year. The consumption of coating solvent as the main component of the coating system was around 6.0 million tons, among which the consumption of ethylene glycol monobutyl ether and ethylene glycol monoethyl ether accounted for 3%-4% of total consumption of coating solvent.
     
3. Domestic ethylene glycol monobutyl ether will gradually replace imported products
     
China imported 138 thousand tons of ethylene glycol monobutyl ether (including diethylene glycol monobutyl ether) in 2011. Dynamic (Nanjing) Chemical Co., Ltd’s ethylene glycol monobutyl ether unit with independent technology has not been in normal operation since it was successfully put into production in 2009. On July 27, 2012 China began to impose corresponding deposit on the imported ethylene glycol monobutyl ether originated from the United States and the European Union to ensure the normal operation of domestic ethylene glycol monobutyl ether units.

4. Demand for polyether VPEG/TPEG in polycarboxylic acid production increases

In 2009 China’s sales volume of 20% polycarboxylic acid (PCA) was around 900 thousand tons, respectively consuming around 75 thousand tons of MPEG (mainly imported from Korea), around 40 thousand tons of APEG, and around 35 thousand tons of VPEG/TPEG, equivalent to consuming around 140 thousand tons of ethylene oxide.
   Due to the excellent product performance of PCA produced using VPEG/TPEG as raw materials and simple production process, the output and sales volume of VPEG/TPEG grew dramatically to more than 120 thousand tons in 2010, far exceeding the growth of MPEG and APEG,  and the market share exceeded 50%.
   To meet the growing market demand, some enterprises like Dynamic International Enterprises Limited, Liaoning Oxiranchem and Shanghai Taijie Chemical Co., Ltd are expanding their capacities. Among which, Dynamic (Nanjing) Chemical Co., Ltd’s new 30 thousand t/a polycarboxylic acid polyether unit will soon start up.

D Sufficient supply of raw materials

In 2011, in addition to producing mono ethylene glycol, China’s commercial ethylene oxide was mainly used to produce non-ionic surfactants, ethanolamine and ethylene glycol ether (including polycarboxylic acid polyether), etc., and was widely used in the sectors like medicine, rubber, dyestuff and concrete water reducing agent. Among which, 18% of ethylene oxide was used to produce ethylene glycol ether (including polycarboxylic acid polyether).
   Ethylene oxide is an important organic chemical product in derivatives of the ethylene industry. It has a wide range of uses in the sectors such as washing/dyeing, electronics, pharmaceuticals, textiles, pesticides, automobile, papermaking, oil extraction and refining, and has a larger market demand.
   In recent years, with the development of low temperature ethylene transportation and storage business, private enterprises and local enterprises have constantly expanded their businesses, and the combined capacity to make ethylene oxide has already reached more than 300 thousand t/a. In 2011 China’s capacity to make commercial ethylene oxide reached 1.336 million t/a.
   For large-scale integrated enterprises, the main raw material ethylene is from cracking units whereas private enterprises and local enterprises mainly rely on outsourcing for low temperature ethylene or ethanol dehydration to ethylene.
   Due to the increase of energy consumption caused by the vaporization of low temperature ethylene, the production cost of outsourcing for low temperature ethylene is slightly higher than that of ethylene directly from cracking units. Ethanol price is on the high side and the production cost of ethanol dehydration to ethylene is higher than that of outsourcing for low temperature ethylene.
   According to incomplete statistics, domestic ethylene oxide projects that are under construction or planned have a capacity of 2.829 million t/a, and these capacities will be all released within 5 years beginning from 2013. With the development of methanol-to-olefins (MTO) technology, more and more enterprises will join the competition, and the market competition of ethylene oxide products will be very fierce. Enterprises that produce ethylene using ethanol as raw material have weak competitiveness.
   With the rapid capacity growth of ethylene oxide in China, the demand for ethylene oxide in its downstream products has increased year-on-year. It is expected that in the next two years, China’s supply of ethylene oxide will increase around 300 thousand tons each year, with a growth of around 20%, and the growth of demand will be around 15%. Therefore, the oversupply of ethylene oxide in China will appear, and the operating rate of ethylene oxide units will decrease year-on-year.

E Integrated operation

1. In the next few years, China’s capacity to make ethylene oxide will increase rapidly. However, the capacity growth will be higher than the demand growth, and the operating rate of ethylene oxide units will reduce apparently. The construction of ethylene oxide units without matched downstream product units will face great risks.
2. As an important derivative of ethylene oxide, ethylene glycol ether (including polycarboxylic acid polyether) will have a certain market development space in the near future.
3. Among ethylene glycol ethers, except for polycarboxylic acid polyether, the demand for ethylene glycol monobutyl ether is the biggest in China. China imported 138 thousand tons of ethylene glycol monobutyl ether (including diethylene glycol monobutyl ether) in 2011. Domestic ethylene glycol monobutyl ether will gradually replace imported products.
4. The consumption of ethylene glycol monomethyl (monoethyl) ether has decreased year-on-year, and ethylene glycol monomethyl (monoethyl) ether has been gradually replaced by propylene glycol ether. In order to comply with the development trend, Dynamic (Nanjing) Chemical Co., Ltd and Jiangsu Tianyin Chemical Industry Co., Ltd has vigorously developed propylene glycol ether series products.
5. Integrated operation of ethylene oxide- ethylene glycol monobutyl ether as well as its acetate and ethylene oxide- polycarboxylic acid polyether industrial chains is more competitive.