China’s POM Market, 2015

By Chang Min, China National Chemical Economic and Technical Development Centre

Supply

As of the end of 2015, China had 10 polyoxymethylene (POM) producers with a total capacity of 470 kt/a. DuPont-Asahi Kasei POM (Zhangjiagang) Co., Ltd. and PTM Engineering Plastics (Nantong) Co., Ltd., which are foreign enterprises, started production in 2004 and 2005, respectively.
China’s capacity to make POM increased from 110 kt/a in 2007 to 470 kt/a in 2015, with an average annual growth of 19.9%, while output climbed from 103 kt in 2007 to 254 kt in 2015, with an average annual growth of 12.0%. China’s major POM producers in 2015 are listed in Table 1.
China’s capacity and output of POM in recent years are shown in Figure 1.
At present, in China, two POM units (the 40 kt/a unit of Kailuan Group Tangshan Zhonghao Chemical Co., Ltd. and the 30 kt/a unit of Bazhou Eastar Industrial & Trade Co., Ltd.) with a combined capacity of 70 kt/a are planned to be put into operation. Kailuan Group Tangshan Zhonghao Chemical Co., Ltd. completed the equipment installation of the POM unit in 2013; however, there was no POM trade in the market at the time. The startup of the POM unit of Bazhou Eastar Industrial & Trade Co., Ltd., planned for operation in October 2014, was postponed.

Demand

In 2015, China made 254 kt of POM, down 2.3% YoY, and the apparent consumption reached 474 kt, up 1.5% YoY. China’s supply and demand of POM in recent years are listed in Table 2.
In China, the manufacture of electronic and electrical appliances is the main consumption sector for POM. In addition, POM has applications in sectors such as the manufacture of daily consumer goods, automobiles and industrial machinery. The consumption pattern of POM in 2015 was around 50% for electronic and electrical appliances, 20% for daily consumer goods, 15% for automobiles, and 8% for industrial machinery.
Electronic and electrical appliances: Consumption of POM in the electronic and electrical appliance sector has increased rapidly, reaching around 50% of total domestic consumption. Consumption in this sector is likely to maintain relatively stable growth; however, the proportion of total consumption will decline considerably.
Daily consumer goods: In the manufacture of daily consumption goods, many kinds of products that incorporate POM, daily consumption goods is the fastest growing consumer of POM in China, and some products are heavily exported.
Automobile industry: At present, the proportion of consumed in the automobile industry is not high, only around 15% of all POM and much lower than the world average.
Industrial machinery: POM is used to make electric hammers, motor protection switches, various mechanical gears, bearings, sliders, guide pulleys, bushings, sealing rings, springs, etc.
Others: POM can also be used in the production of agricultural sprayers, gas meters, water meter parts, tube nozzles, military supplies, etc. China’s consumption pattern of POM in 2015 is shown in Figure 2.
China’s consumption of POM in automobile production as well as automobile repair parts will increase from 0.5 kg per vehicle to 1-1.2 kg per vehicle. Consumption of POM will continue to increase rapidly, especially in the manufacture of automobiles, daily consumption goods and industrial machinery.

Table 1   China’s major POM producers, 2015

Producer    Capacity
(kt/a)
Chongqing Branch of Yuntianhua Co., Ltd.    60
Yunnan Yuntianhua Co., Ltd.    30
Kaifeng Longyu Chemical Co., Ltd.    40
CNOOC Tianye Chemical Co., Ltd.    60
DuPont-Asahi Kasei POM (Zhangjiagang) Co., Ltd.    20
PTM Engineering Plastics (Nantong) Co., Ltd.    60
Shenhua Ningmei Coal Chemical Co., Ltd.    60
Yankuang Lunan Chemical Co., Ltd.    40
Shanghai Bluestar POM Co., Ltd.    60
Tianjin Alkali Plant of Tianjin Bohai Chemical Industry Group Co., Ltd.    40
Total        470


Foreign trade

In 2015, China’s import volume of POM reached 258 kt, up 4 kt year-on-year, and the growth was 1.6%. Major import sources included Taiwan province, South Korea and Malaysia, and the import volume from these three regions respectively accounted for 18.5%, 17.7% and 11.9% of the total volume imported. Guangdong province was the region with the largest import volume, taking 45.8% of the total import volume. Shanghai and Zhejiang province came next, accounting for 21.6% and 10.4%, respectively. Shanghai customs was the largest import customs, handling 26.3% of the total. Shenzhen customs and Huangpu customs came next, accounting for 24.2% and 18.2%, respectively.
In 2015, China exported 38 kt of POM, down 9 kt year-on-year. Jiangsu province was the main export region, accounting for 44.2% of the total export volume. Guangdong province came next, accounting for 37.7%. Hong Kong was the major export destination of POM, accounting for 65.5%, and Japan came next, accounting for 6.4%.

Table 2   China’s supply & demand of POM, 2011-2015  (kt)

Year    Output    Import volume    Export volume    Apparent consumption    Self-sufficiency
rate (%)
2011    205    211    66    350    58.5
2012    240    213    58    396    60.7
2013    270    240    61    449    60.1
2014    260    254    47    467    55.7
2015    254    258    38    474    53.6


The export passed through Nanjing customs and Shanghai customs, respectively accounting for 37.4% and 23.4%.
At present, many POM products in China are low-end and mid-market products, and they are seriously oversupplied. High-end products are still mainly imported, with over 200 kt imported each year. China urgently needs breakthroughs for its technical impediments in the manufacture of high-end POM.