Toluene Market in China, 2015
Year:2016 ISSUE:20
COLUMN:ORGANICS
Click:291 DateTime:Nov.07,2016
Toluene Market in China, 2015
By An Chao, China National Chemical Economic and Technical Development Centre
Supply
At the end of 2015, China’s toluene capacity was 8.43 million t/a, output was 5.31 million tons and the operating rate was around 63%. Table 1 shows the major toluene producers in China in 2015.
Toluene capacity has increased from 1.66 million t/a in 2005 to 8.43 million t/a in 2015, with an average annual growth of 17.6%. Output increased from 900 kt in 2005 to 5.31 million tons in 2015, with an average annual growth of 19.4%. Figure 1 shows the capacity and output of toluene in China in recent years.
Toluene capacity expanded further in 2015. New units were built mainly in Northeast China, Shandong and South China. The 280 kt/a toluene unit in CNOOC Ningbo Daxie Petrochemical Co., Ltd. is scheduled to start production in 2016. Other new units will mostly be put on stream at the end of 2016.
Table 1 Major toluene producers in China, 2015
Sinopec Zhenhai Refining & Chemical Co., Ltd. 360
Tianjin Petrochemical Co., Ltd. 405
Wuhan Petrochemical Co., Ltd. 144
Shanghai SECCO Petrochemical Co., Ltd. 160
Maoming Petrochemical Co., Ltd. 140
Jinling Petrochemical Co., Ltd. 354
Luoyang Petrochemical Co., Ltd. 120
Changling Petrochemical Co., Ltd. 70
BASF-YPC Co., Ltd. 120
Guangzhou Petrochemical Co., Ltd. 150
Jiujiang Petrochemical Co., Ltd. 172
Shijiazhuang Refining & Chemical Co., Ltd. 27
Zhanjiang Dongxing Petrochemical Co., Ltd. 50
Yangzi Petrochemical Co., Ltd. 300
Shanghai Petrochemical Co., Ltd. 480
Qilu Petrochemical Co., Ltd. 282
Nanjing Refinery 114
Fujian Refining & Chemical Co., Ltd. 250
Yanshan Petrochemical Co., Ltd. 96
PetroChina Guangxi Petrochemical Co., Ltd. 150
Dushanzi Petrochemical Co., Ltd. 220
Fushun Petrochemical Co., Ltd. 200
Lanzhou Petrochemical Co., Ltd. 250
Jilin Petrochemical Co., Ltd. 120
Daqing Petrochemical Co., Ltd. 204
Jinzhou Petrochemical Co., Ltd. 28
Urumqi Petrochemical Co., Ltd. 30
Renqiu Petrochemical Co., Ltd. 130
Huachen Energy Co., Ltd. 60
Dalian Petrochemical Co., Ltd. 450
Jinxi Petrochemical Co., Ltd. 18
Other enterprises Qingdao Lidong Chemical Co., Ltd. 184
Ningbo Hebang Chemical Co., Ltd. 150
Heze Dongming Petrochemical Group Co., Ltd. 80
Shandong Qi Wangda Group Co., Ltd. 70
CNOOC Shell Petrochemical Co., Ltd. 280
CNOOC Refining & Chemical Co., Ltd. 220
Dragon Special Resin (Xiamen) Co., Ltd. 300
Shenyang Paraffin-Wax Chemical Co., Ltd. 30
Chambroad Petrochemicals Co., Ltd. 20
Hebei Xinqiyuan Energy Technology Development Co., Ltd. 100
Dalian Fujia Group Co., Ltd. 250
Changyi Petrochemical Co., Ltd. 100
Liaoning Huajin Chemical Industries Group Corporation 150
Shandong Utai Technology Co., Ltd. 40 (first phase)
Shandong Huifeng Petrochemical Co., Ltd. 110
Linyi Runze Petrochemical Co., Ltd. 0
Wuhan Kaishun Petrochemical Co., Ltd. 70
WEPEC 400
Panjin Baolai Petrochemical Co., Ltd. -
Zhuhai Refining & Chemical Co., Ltd. 150
Shaanxi Yanchang Petroleum (Group) Co., Ltd. 70
Total 8 430
Demand
The apparent consumption of toluene in China was 6.06 million tons in 2015, an increase of 84 kt and 1.4% over the previous year. Self-sufficiency was 87.7%, 3.3 percentage points higher than in the previous year. Inside China, the apparent consumption of toluene has grown in recent years. Table 2 shows the details.
China’s consumption of toluene in 2015 was concentrated in the manufacture of solvents, PX, TDI, benzoic acid and nitrotoluene. It was also used in making other chemicals such as benzyl chloride, caprolactam and p/m-cresol. The use in solvents was the most important application of toluene. The solvents were used mainly in adhesives, coatings, inks, pesticides, medicines and PU leather. The consumption of toluene in making solvents accounted for around 35% of the total. The consumption proportion was 22% for PX and 15% for TDI. Both the capacity and the supply of most toluene downstream products are in surplus today. Producers have turned to the export market and there are hardly any growth points for the demand. The standard for gasoline is upgraded to National V and restrictions are imposed on the use of other gasoline blending raw materials such as MTBE. Mixed aromatics now compete with toluene. With the increase of the supply and the improvement of the competitive advantage, the demand for toluene in gasoline blending will surely increase steadily.
Foreign trade
China is a net importer of toluene. The total trade volume of toluene in China was 755 kt in 2015 and the total trade value was US$529.3 million. Of the total, the import volume was 750 kt, a drop of 183 kt and 19.6% from the previous year and the export volume was 5 kt, an increase of 3 kt. Table 3 shows the import and export of toluene in China in recent years.
Major sources for the import of toluene to China in 2015 included Korea, Singapore and Japan. The volume imported from Korea was 299 kt, 39.8% of the total. Among provinces, Jiangsu imported the most toluene by far: 553 kt, 73.7% of the total. China exported little toluene, only 5 kt in 2015. Regions that export included mainly Shandong and Liaoning, and the volume exported accounted for 35.6% of the total. The main export destinations were Korea and DPRK.
Table 2 Consumption of toluene in China, 2013-2015 (kt)
Year Output Import volume Export volume Apparent consumption Self-sufficiency (%)
2013 5 050 812 3 5 859 86.2
2014 5 040 933 2 5 971 84.4
2015 5 310 750 5 6 055 87.7
Table 3 China’s foreign trade in toluene
Year Import Export
Volume
(kt) Value
(US$ million) Volume
(kt) Value
(US$ million)
2011 655 704.6 8 9.2
2012 660 773.3 7 8.3
2013 812 977.7 3 4.1
2014 933 1 060.9 2 3.0
2015 750 525.0 5 4.3
Market price
The toluene market in China hit a new low in 2015, and the average price was the lowest of the past decade. The toluene market made an overall increase in the first half of 2015. With the increase of the crude oil supply, however, the price of crude oil futures in the international market dropped below the lowest point seen in the first half of 2015. The price of toluene in the domestic market therefore came down to RMB4 940/t in August. The demand for toluene in gasoline blending then offered a driver to the slack toluene market and the price of toluene picked up to RMB5 650/t in October. The price of toluene once again dropped to RMB5 050/t at the end of the year.
As the price of crude oil will remain low, the toluene market can hardly shake off the slackness in 2016. Due to the constant increase of labor costs, some toluene producers in China have gradually shifted production to countries with cheap labor in Southeast Asia. The demand for toluene in the domestic market will decline further, and the price of toluene will stay low.