PU Composites: Market Demand Keeps Increasing Steadily

By Shen Rui, China National Chemical Information Centre

PU products have great many varieties. They mainly include foam plastics (flexible foams, rigid foams and semi-rigid foams), elastomers (CPU, TPU and waterproof paving materials), fibers (PU fiber), leather/shoe resins (synthetic leather slurry and shoe sole fluid), coatings, sealants and adhesives. Foam plastics are the most common. Flexible foams mainly go into making furniture, bed mattresses, automobiles and carpets. Rigid foams mainly go into making building thermal insulation and industrial heat insulation.
Globally, the rapid development of construction, automobile, electronic equipment, new energy and environmental protection sectors has greatly promoted demand for PU products. PU products can reduce the weight and extend the life of automobiles. In the next decade, applications of PU products in some other sectors will expand rapidly. Experts say global PU demand increase at an annual rate of 4.5%. The growth of PU demand in the refrigeration, shoe, textile and leisure sectors is expected to be 5.7% a year. The growth of PU demand in making furniture, bedding and industrial products will be slightly lower, around 3.3%.
PU markets are concentrated mainly in North America, Western Europe, Asia-Pacific (Japan and Korea) and China. Consumption in these markets accounts for around 85% of the world total. China consumes around 40% of the world total.

Increasing demand

The PU sector in China has grown steadily in recent years. Industrial scale keeps expanding and output increases steadily. Figure 1 shows the details.
Pushed by the real estate, automobile and shipbuilding sectors, the PU coating market in China is getting stronger and stronger. Despite the drastic reduction of railway engineering and construction projects, the output of construction coatings maintains high growth. Figure 2 shows the details.
The output of PU resins for leather and shoes has also increased considerably. The big market for flexible PU foams is promising, pushed by demand in the automobile and furniture sectors. Demand for rigid PU foams in the solar energy, refrigerating equipment and pipeline thermal insulation sectors has also increased.
The total output of PU products in China is exceeding 10.0 million tons in 2016, an increase of around 2% over last year. The product with the most rapid output growth is TPU. With the constant capacity expansion of Wanhua and Huafeng, the market supply has increased drastically. Despite weak financial performance and reduced demand in shoemaking materials, the TPU film market has developed rapidly, with overall consumption around 5% higher than in 2015. The output of flexible foams has increased around 3%. Due to a shrinkage of terminal demand, the output of rigid foams is down by 5.76%. The demand for PU fiber is okay, and output is up by 4.36%. The overall trend of the slurry market is quite slack. Due to increasingly stringent environmental protection requirements, some synthetic leather enterprises have suspended production. Weak demand has led to low operating rates of slurry producers, and their overall output is down by 2.24%. The shoe sole fluid market is quite stable, but with impacts from the shifts and upgrading in the shoemaking sector, the market is still slack in the second half of 2016, and output is only 2% higher. The market demand for PU coatings and adhesives has also increased just a little.
Owing to its advantages in heat insulation, abrasion resistance, sound isolation and waterproofing, PU is extensively used in many sectors such as construction. Demand increases constantly. The prospects of the PU market in China are still promising. The PU market share of foam plastics is shrinking slowly, whereas the share held by CASE (coatings, adhesives, sealants and elastomers) increases constantly. Figure 3 shows the details.
Foreign trade of various PU materials differs somewhat. The export volume of foam PU boards and artificial leather is greater than the import volume. The import volume of PU solvents and paints is higher than the export volume.

Future development orientation

The PU sector in China has huge opportunities for upgrades and development. The per-capita consumption of PU in China is 4-5 kg today, a relatively low level compared with advanced countries. On the basis of existing markets, therefore, the PU sector in China should promote PU’s use in the automotive, high-speed rail, solar energy, building insulation, environmental protection and emerging sectors. The economy in China will enter a new period of stable growth during the Thirteenth Five-Year Plan period (2016-2020). The PU sector will also be faced with a new slowdown of growth and accelerated restructuring.