Polycarbonate Capacity to Increase in China

By Zhang Na, China National Chemical Information Centre

Forthcoming growth of capacity

At the end of 2014, there were five polycarbonate (PC) producers in China – Bayer Polymer (Shanghai) Co., Ltd. (200 kt/a), Teijin Polycarbonate Co., Ltd. (147 kt/a), Sinopec Mitsubishi Chemical Polycarbonate (Beijing) Co., Ltd. (60 kt/a), LingYou Engineering Plastics (Shanghai) Co., Ltd. (80 kt/a) and Ningbo Zhetie Daphoon Chemical Co., Ltd. (100 kt/a, a new producer). Their total capacity was around 587 kt/a.
A number of equity or contractual joint venture PC projects are being launched in China today. Quite a few of them will start production in the next two years. The supply of PC will increase drastically during that time. For example, Luxi Chemical Group Co., Ltd. is constructing a PC plant. The first phase has a capacity of 65 kt/a and will be completed and put on stream in 2015. Globe Joint Chemical Co., Ltd. will construct a plant with planned capacity of 260 kt/a. The first phase, with a capacity of 130 kt/a, made EIA information public in January 2015 and has scheduled for startup in the third quarter of 2015. SABIC and Sinopec will jointly construct a 260 kt/a PC project in Tianjin Binhai New Area, at an equity ratio of 50:50. The plant will consist of two 130 kt/a production units, and production is expected to start in 2017. Mixed-grade, extrusion-grade, optical-grade and molding-grade varieties will be produced. Yantai Wanhua Polyurethane Co., Ltd. started construction of a 100 kt/a PC unit in April 2015. Table 1 shows the new/expansion PC projects in China.

Table 1    New/expansion PC projects in China     (kt/a)

Producer    Capacity     Remarks
Luxi Chemical Group Co., Ltd.    65    Phosgene process
Globe Joint Chemical Co., Ltd.    130    Non-phosgene process
Sinopec/SABIC (Tianjin) Petrochemical Co., Ltd.    260    Non-phosgene process technology from SABIC
Bayer MaterialScience (China) Co., Ltd.    200    Ester exchange melt poly-condensation process technology from Bayer
Yangquan Coal Group Qingdao Hengyuan Chemical Co., Ltd.    100    Non-phosgene process
Lihuayi Weiyuan Chemical Co., Ltd.    100    Phosgene process
Yantai Wanhua Polyurethane Co., Ltd.    100    Non-phosgene process
Total    955     


Constant increase of imports

China’s PC import volume has stayed high in recent years. It was 899 kt in 2006, went up to 1 017 kt in 2008, reached 1 375 kt in 2012 and increased further to 1 480 kt in 2014. The main reasons for the constant increase of the PC import volume are as follows: (1) Both the capacity and the output of PC are low in China, and growth is slow, while consumption is increasing rapidly. (2) Domestic products fail to meet the market demand in quality and diversity. (3) Rapid demand growth among manufacturers of high-end materials and alloy materials has promoted the constant growth of the import volume.
The biggest source of imported PC in 2014 was Korea, and the amount was 324 kt, accounting for 21.9% of the total and an increase of 3.2% over the previous year. Taiwan came next at 261 kt, accounting for 17.6% and increasing 11.5%. Other sources, in declining order of volume included Thailand, the United States, Saudi Arabia and Japan.

Future development

The import dependence has always exceeded 80% in China in recent years. Moreover, four of China’s five producers are Chinese-foreign joint ventures. Most of the planned units are Chinese-foreign funded or contractual joint ventures.
With the rapid expansion of PC capacity in China, the supply will be upgraded dramatically in the next few years, and import dependence will be reduced. Capacity is expected to reach 1 542 kt/a in 2017, easing import dependence to a great extent. Figure 1 shows the supply/demand balance of PC in China in recent years.