Matured Plastic Pipe Sector Enters a New Period of Development in China

By Wang Zhanjie, China Plastic Processing Industry Association Plastic Pipe Committee

Overall, the macro economy in China has developed at an accelerated rate in recent years. The market demand for pipe in construction, municipal infrastructure, water conservancy, and agricultural and industrial sectors increased constantly, promoting rapid development of the plastic pipe sector.

   1. Capacity and industrial concentration both increased.

   China’s output of plastic pipe reached 11.00 million tons in 2012, an increase of 10% over the previous year. Despite the elimination of some small enterprises in some areas, there are still over 5 000 plastic pipe enterprises in China. More than 20 of them have a capacity of over 150 kt/a and their output accounts for more than 35% of the national total. Table 1 shows the output of plastic pipe in China in recent years.
   Unlike previous years, although the number of enterprises entering the plastic pipe sector is down, new entrants are usually strong. They are intent on large economic scale, and most of them have a capacity of over 30 kt/a. In the past, plastic pipe enterprises were mainly concentrated in coastal areas and economically developed areas such as Guangdong and Zhejiang. In recent years, however, some large enterprises have made investments or expanded capacity in Northeast China, North China, Central China and the Western Region. Owing to the construction of plants in these regions, the regional distribution of the plastic pipe sector tends to be rational.

   2. There are more varieties with new materials and new structures.

   China has already established a plastic pipe processing sector with PVC, PE and PP as main materials. Some technologies for plastic pipe with new materials have also achieved considerable advances. Plastic/plastic and plastic/metal composite pipe products are being developed rapidly. There is also a drastic increase in the consumption of PE-X, PE-RT, UHMW-PE and PVC-M. Production and application have started for products with special structures such as solid-wall pipe, corrugated pipe, ribbed pipe, braided pipe, cellular-core pipe and internal-spiral pipe.

   3. Application sectors are further expanded.

   The construction sector, the municipal water supply/drainage sector and the agricultural sector (drinking water, irrigation/drainage) are still the major application sectors for plastic pipe. The consumption of plastic pipe in the construction sector accounts for around 60% of the total. The consumption proportion in sewage treatment, heating and urban non-excavation engineering is also increasing constantly. The latest market figures show that the market demand for plastic pipe in the construction sector tends to be stable, whereas the consumption proportion in municipal infrastructure and special uses has gone further up. According to statistics, 130 city-water supply enterprises added 19 729km of water supply pipe during 2010-2011. Of the total, the length of plastic pipe was 9 159km, accounting for around 46.42% and second only to metal pipe.

   4. The export volume increased and at much higher prices.

   The export of plastic pipe from China has seen sustained growth in recent years. The export amount was close to 500 kt in 2012, an increase of 9.0% over the previous year. More gratifying is that the export price has been rising. The average export price was US$3 816 per ton in 2012, being 14.2% higher than the previous year.

   5. Existing problems

   (1) There is serious oversupply.
   The plastic pipe capacity in China today is more than 25.00 million t/a. The overall equipment utilization rate is quite low. There is already serious oversupply and competition in the sector is aggravated.
   (2) Raw materials constrain the development of the sector.
   The resin sector in China has achieved considerable progress in recent years. The development of the PVC sector, in particular, is quite rapid. Nevertheless, there are still problems such as incomplete specification and inadequate supply of some resin varieties. Some have unreliable quality, and some must be imported. These factors have constrained the performance improvement of pipe and also caused some worries among clients about the quality of domestic raw materials.
   (3) Product innovation needs to be strengthened.
   Many similar general-purpose products flood the market. Medium and low-grade products dominate, whereas products with high technical content and high added value are relatively few. The plastic pipe sector should develop constantly, by its own effort, to accelerate innovation, develop new products and further improve the precision, reliability, stability and matching ability of products.
   (4) Project quality should be further improved.
   (5) Standardization work needs to be further intensified.

   6. Forecast

   It is expected that the output of plastic pipe in China will maintain a growth of around 10% in next few years and reach more than 13.20 million tons in 2015. Plastic pipe’s share of the pipe market will be over 50%.
   While taking PVC, PE and PP pipe as their development focus, players in plastic pipe should strengthen their research and development into modified, composite and other new plastic pipe products, quickly improve pipe production and application technology systems and enhance product performance so as to keep abreast of the expansion of new application sectors.
   The development and production of plastic pipe with new materials, modified and composite plastic pipe, environment-friendly plastic pipe and new plastic pipe systems should be highlighted to meet the performance requirements in special sectors such as environmental protection, energy conservation, fire control, bacteria deterrence, insulation, oxygen inhibition, reinforcement, shock resistance and noise reduction.
   Various modification methods should be used to enhance the comprehensive performance of PVC pipe materials such as PVC-M, PVC-O, FPVC, inorganic nanometer-modified PVC and PVC-C. The use of environment-friendly heat stabilizer in PVC-U pipe to replace lead salt stabilizers should be promoted to further expand the application scope and the market share of PVC pipe.
   The technical level and the matching ability of same-level water drainage plastic pipe systems, floor heating plastic pipe systems, geothermal heat pump plastic pipe systems, solar hot water plastic pipe systems, reclaimed water/rain water recycling plastic pipe systems and indoor ventilation plastic pipe systems in the construction sector should be further upgraded.
   Close attention should be paid to the construction of urban water drainage and sewage drainage pipe systems to disseminate the use of large-diameter plastic pipe for water drainage, such as high-modulus PP double-wall corrugated pipe and composite braided reinforced pipe. Rain water recycling, storage and reuse systems should be promoted. The research, production and application of large-diameter pressure plastic pipe and composite plastic pipe for urban central heating secondary pipeline networks should be highlighted.
   Non-excavation technologies, including non-excavation construction and old pipeline repair, should be actively advocated in buried pipeline engineering. The research, development and application of HDPE and PE-RC with stress-cracking resistance should be promoted.
   Plastic pipe used in the medium/high-pressure transmission of crude oil and oil products and the abrasion-resistant, corrosion-resistant and heat-resistant transmission of special media and plastic pipe with flame-retarding and antistatic properties used in mines should be vigorously developed. Examples include RTP, UHMW-PE with a molecular weight of over 2.00 million, large-diameter PEX, special materials and composite pipe.  

Table 1    Output of Plastic Pipe in China in Recent Years (kt)

Year            2008    2009    2010    2011    2012
Output            4 593    5 804    8 402    10 000    11 000
YoY Growth (%)    28.2    18.9    31.1    19.0    10.0