PMMA Market in China

By Zhao Yongquan, China National Chemical Economic and Technical Development Centre

Supply

During 2015, China’s polymethyl methacrylate (PMMA) capacity reached 368 kt/a, an increase of 0.8% over the previous year. The supply volume was 217 kt, equal to that of the previous year. Capacity utilization was 59.0%, and there were eight producers (see Table 1 for details).

Table 1   Major PMMA producers in China, 2015

Producer    Capacity (kt/a)
Zhenjiang Chimei Chemical Co., Ltd.    90
Nantong Rayon Chemical Co., Ltd.    60
Evonik (Degussa)     40
Heilongjiang Zhongmeng Longxin Chemical Co., Ltd.    15
Lucite International (China) Co., Ltd.    60
Shanghai Jingqi Polymer Science Co., Ltd.    20
Suzhou Double Elephant Optical Material Co., Ltd.    80
Kuraray Acrylic (Zhangjiagang) Co., Ltd.    3


Table 2   Consumption of PMMA in China, 2013-2015  (kt)

Year    Output    Import volume    Export volume    Apparent consumption    Self-sufficiency
(%)
2015    217    188    10    395    54.9
2014    217    225    12    431    50.3
2013    155    225    14    366    42.3




PMMA capacity is unlikely to change by the end of 2016, and the output may increase to 228 kt. The apparent consumption of PMMA in 2016 picked up compared with 2015 and was still slightly higher than the capacity.

Demand

The apparent consumption of PMMA in China reached 395 kt in 2015, a drop of 36 kt (8.4%) from the previous year. Self-sufficiency went up to 54.9%, 4.6 percent points higher than in the previous year. The apparent consumption of PMMA in China has grown slowly in recent years (see Table 2 for details).


Table 3   China’s foreign trade of PMMA, 2014-2015
Year    Import    Export
    Volume
(kt)    YoY growth
(%)    Value
(US$ million)    YoY growth
(%)    Volume
(kt)    YoY growth
(%)    Value
(US$ million)    YoY growth
(%)
2015    188    -16.4    460.0    -19.6    10    -16.7    29.1    -8.6
2014    225    0    572.2    -1.8    12    -14.3    31.8    -13.9



Application sectors of PMMA in China are extremely extensive including internally lit advertising boxes, labels, lamp fittings, bathtubs, gauges, daily life articles and furniture. High-end products are used in LCD light guides, ray prevention, optical fibers, solar photovoltaic cells, CDs and VCDs. The market demand for PMMA is expanding rapidly. The development of the LCD manufacturing sector in recent years, in particular, has brought about growth of light guide material consumption. Optical-grade PMMA has gradually become the polymer material with the highest growth. Figure 1 shows the consumption structure of PMMA in China in 2015.
The market of engineering plastics in China generally has surplus capacity for low-end materials and depends on imports at the high end. PMMA is no exception. The market growth for low-end plates is limited, while new prospects are in high-end varieties. China-based PMMA producers are mainly foreign-funded enterprises. PMMA produced in China in future will mainly be high-end varieties.
The future development opportunity of PMMA will be focused on optical-grade PMMA, as it is in short supply and has bright application prospects. High-performance optical-grade PMMA LCP is mainly used in high-end markets such as the production of LCD light guides, optical fiber materials and solar photovoltaic cells. In China only a few enterprises funded by Germany, Japan and Taiwan are making the production today.

Foreign trade

The total foreign trade volume of PMMA in China was 198 kt in 2015, a drop of 16.5% from the previous year. The total trade value was US$489.1 million, a drop of 19%. The import volume of PMMA was 188 kt in 2015, a drop of 16.4%. The export volume was 10 kt, a drop of 2 kt. Table 3 shows China’s foreign trade of PMMA in recent years.
The main import sources of PMMA were Korea, Singapore and Japan, and the volumes imported accounted respectively for 35.9%, 29.4% and 19.1% of the total. The region with the biggest import volume was Guangdong, accounting for 36.8% of the total. Jiangsu and Shanghai came next, accounting respectively for 29.6% and 9.6%.

Market price

With the sustained slack market, the prices of PMMA in 2015 were almost always declining. The average market price was RMB16 006/t in 2015, a drop of RMB1 137.5/t and 6.6% from the average price of RMB17 143.6/t in 2014.
PMMA prices fell drastically from the end of April to early August 2015. Reasons included the pressure of the overall engineering plastics market trend, a sustained reduction of raw material prices, constant weakening of the cost backing and extreme flatness of terminal demand. As the price of raw material MMA made a small-range increase for a short period of time in late August, the cost backing gradually returned to normal, and the PMMA market price improved temporarily. Starting from September, however, with impacts from various unfavorable factors, prices of raw material MMA slid sharply, and the cost limit of PMMA was once again lowered. Figure 2 shows the market price trend of PMMA in East China in 2015.
The price trend of PMMA is roughly identical to the price trend of engineering plastics. It is expected that the imbalance between supply and demand of PMMA will remain prominent in 2016.