China’s Aniline Market in 2015

By Yang Bo, China National Chemical Economic and Technical Development Centre

Supply

Over the past ten years, China’s demand for aniline has increased greatly, so quite a few domestic enterprises have invested in expanding capacity in recent years. As of the end of 2015, China had 26 aniline producers with a total capacity of 3.78 million t/a, and domestic output reached 1.86 million tons, up 4.4% YoY (see Figure 1).
At present, the combined capacity of aniline in China’s top five aniline enterprises is 2.04 million t/a, accounting for 54% of the national total. China’s major aniline producers in 2015 are listed in Table 1.


Table 1   China’s major aniline producers in 2015

Location    Producer    Capacity
(kt/a)
Zhejiang province    Ningbo Wanhua Polyurethanes Co., Ltd.    720
Jilin province    Jilin Connell Chemical Industry Co., Ltd.    360
Shandong province    Yantai Wanhua Polyurethanes Co., Ltd.    360
Shandong province    Shandong Jinling Chemical Co., Ltd.    300
Chongqing    BASF Polyurethanes (Chongqing) Co., Ltd.    300
Shanghai    Bayer MaterialScience?(Shanghai) Co., Ltd.    280
Shanxi province    Shanxi Tianji Coal Chemical Group Co., Ltd.??    265
Jiangsu province    Sinopec Nanjing Chemical Industry Co., Ltd.    260
Shanghai    Shanghai Lianheng Isocyanate Co., Ltd.     160
Jiangsu province    SP Chemicals (Taixing) Co., Ltd.?    135
Gansu province    PetroChina Lanzhou Petrochemical Co., Ltd.    70
Shandong province    Zhangqiu Riyue Chemical Co., Ltd.?    80
Chongqing    Chongqing Changfeng Chemical Industry Co., Ltd.    50
Hebei province    Hebei Jiheng Chemical Group Co., Ltd.    50
Shandong province    CNOOC Haihua Co., Ltd.    50
Jiangsu province    Jiangsu Leasty Chemical Co., Ltd.    50
-    Others    290
Total    3 780


The distribution of China’s capacity to make aniline is mainly concentrated in East China – Zhejiang province, Jiangsu province, Shanghai and Shandong province. In addition, Jilin province is also the main production base of aniline. The industrial layout is consistent with that of upstream pure benzene and downstream diphenylmethane diisocyanate (MDI) as well as rubber auxiliaries.
At present, the capacity to produce aniline has been seriously in surplus, the overall operating rate reached a record low of 49.2% in 2015, down 7.5 percentage points year-on-year. In the context of China’s supply-side reforms and capacity reduction, some small outdated units will be on the verge of elimination. It is expected that the capacity to make aniline will be less likely to expand in the next three years, and it will be reduced considerably from the 2015 level.

Demand

In 2015, China’s output of aniline reached 1.86 million tons, up 4.4% YoY. The domestic apparent consumption of aniline reached 1.759 million tons, and the average annual growth of apparent consumption during 2005-2015 was around 13.7%. China’s supply and demand for aniline during 2010-2015 are shown in Table 2.
Aniline is mainly used for the production of MDI, while the MDI downstream polyurethane products are mainly used for producing rigid foam and semi rigid foam, elastomer and coating resins, etc. According to statistics, China’s output of MDI reached 1.968 million tons in 2015, consuming around 1.3 million tons of aniline.

Table 2   China’s supply & demand for aniline, 2010-2015

Year    Capacity
(kt/a)    Output
(kt)    Import volume (kt)    Export volume (kt)    Apparent consumption (kt)
2010    2 155    1 300    92    3    1 389
2011    2 605    1 450    10    8    1 452
2012    2 900    1 597    0    13    1 584
2013    2 960    1 691    0    20    1 671
2014    3 140    1 781    0    50    1 731
2015    3 780    1 859    0    100    1 759


Another major purpose of aniline is as a rubber processing chemical and for intermediates such as vulcanization accelerators, antioxidants, antiozonants and stabilizers. A small amount of aniline is used as an intermediate for the production of pesticides (fungicides), herbicides and other agricultural chemicals. According to China Rubber Industry Association, China’s output of rubber auxiliaries reached 1.0 million tons in 2014, of which 85% of the rubber auxiliaries are made with aniline, and based on this estimate, the consumption of aniline in the production of rubber auxiliaries was around 300 kt.
Aniline is also an important intermediate of dyes (mainly azo dyes) and pigments. Other applications of aniline include cyclohexylamine (boiler water treatment agents and rubber chemicals), pharmaceuticals, textile chemicals, photographic imaging agents, amino resins, explosives and special fibers.
China’s consumption mix of aniline in 2015 was around 74% for MDI, around 17% for rubber auxiliaries and around 9% for other purposes. China’s consumption mix of aniline in 2015 is listed in Figure 2.
The consumption of aniline is mainly driven by MDI, and the terminal consumption mainly includes refrigerators, freezers, cold chain logistics, construction, plumbing equipment insulation and cars. China’s household electrical appliance and automotive markets have already matured, so there is no significant growth. The real estate market is almost saturated. Therefore, the consumption of aniline will grow more slowly.

Import and export

In 2015, China’s export volume of aniline reached 100 kt, up 100% YoY, with an export value of US$102 million. China’s export volume of aniline has been increasing year-on-year. Before 2012, China imported a certain amount of aniline each year. With the domestic capacity gradually reaching saturation, China’s import volume of aniline reduced sharply from 92 kt in 2010 to 10 kt in 2011. Since 2012, there has been no import trade of aniline. It is expected that in the next 2-3 years, China’s export volume of aniline will maintain a certain growth.

Price

In 2015, the average annual price of aniline in East China was RMB6 522/t, compared with RMB10 164/t in 2014 and RMB11 452/t in 2013.



Table 3   China’s import & export of aniline, 2010-2015

Year    Import    Export
    Volume (kt)    Value (US$ million)    Volume (kt)    Value (US$ million)
2010    92    120.3    3    4.5
2011    10    13.7    8    12.2
2012    0.0    0.0    13    20.2
2013    0.0    0.0    20    35.2
2014    0.0    0.0    50    81.7
2015    0.0    0.0    100    102.0


During 2005-2015, China’s demand for aniline in making MDI increased rapidly, promoting the domestic consumption of aniline. China’s capacity to make aniline also expanded constantly, resulting in the overcapacity. In 2015, the overall operating rate of the domestic aniline sector declined. It is expected that China’s aniline market will remain low in 2016.
In 2015, major downstream sectors using polyurethane such as building insulation, automotive components, white household appliances, synthetic leathers, shoe materials and textiles entered a stable development period, and the demand growth slowed down somewhat. Aniline will enter a period of stable development.