Nylon 66 Chip Market in China

By An Chao, China National Chemical Economic and Technical Development Centre

Supply

At the end of 2015, China was home to seven producers of nylon 66 chips with a combined capacity of 316 kt/a, exceeding that of 2014 by only 30 kt/a. Output reached 221 kt in 2015, a YoY increase of 10.5%. The average operating rate was around 70.0%. The producer with the biggest capacity (150 kt/a) was Pingdingshan Shenma Engineering Plastics Co., Ltd. Back in 2010, China Pingmei Shenma Group Engineering Plastics Co., Ltd. had acquired a 60% stake in each of two firms, Nantong Pengfa Polymer Material Co., Ltd. and Quanzhou Shiteng Technology Development Co., Ltd. and established China Pingmei Shenma Jiangsu New Material Technology Co., Ltd. and China Pingmei Shenma (Fujian) Technology Co., Ltd. These two enterprises’ respective nylon 66 chip capacities were 28 kt/a and 8 kt/a. In 2015 Shanghai Huafon Group constructed a 30 kt/a nylon 66 chip continuous production unit in an effort lasting 14 months. It is the biggest single continuous production line for nylon 66 chips in China today. Table 1 shows the capacity of major nylon 66 chip producers in China in 2015.

Table 1   Major nylon 66 chip producers in China, 2015

Producer    Location    Capacity (kt/a)

Pingdingshan Shenma Engineering Plastics Co., Ltd.    Henan    150
Zhejiang Huafon Group Co., Ltd.    Zhejiang    40
Liaoning Xingjia Chemical New Material Co., Ltd. (Anshan Guorui Chemical Co., Ltd.)    Liaoning    40
China Pingmei Shenma Jiangsu New Material Technology Co., Ltd.    Jiangsu    28
Jiangsu Huayang Nylon Co., Ltd.    Jiangsu    20
China Pingmei Shenma (Fujian) Technology Co., Ltd.    Fujian    8
Shanghai Huafon Group    Shanghai    30
Total        316


China’s nylon 66 chip capacity has increased steadily from around 108 kt/a in 2005 to 316 kt/a in 2015, with average annual growth of around 10.3%. Output increased from 46 kt in 2005 to 221 kt in 2015, with average annual growth of around 15.3%. Figure 1 shows the capacity and output of nylon 66 chips in China in recent years.
Capacity will keep increasing steadily in the next few years. INVISTA, one of the most important adipic dinitrile and nylon 66 chip producers in the world, has constructed a new 200 kt/a nylon 66 chip integrated unit in Shanghai Chemical Industry Park. Construction started in March 2014, and the unit was completed and put on stream in 2016.

Demand

The apparent consumption of nylon 66 chips in China was 460 kt in 2015, an increase of around 7.5% over the previous year. National self-sufficiency was 48.1%, and import dependence was 62.1%. Table 2 shows the apparent consumption of nylon 66 chips in China in recent years.

Table 2  Apparent consumption of nylon 66 chips in China, 2010-2015  (kt)

Year    Output    Import volume    Export volume    Apparent consumption    Self-sufficiency (%)
2010    127    225    43.5    371    34.2
2011    131    231    45    317    41.3
2012    168    240    50    358    47.0
2013    177    271    49    399    44.3
2014    163    315    49    428    38.1
2015    221    286    47    460    48.1


Table 3    China’s nylon 66 chip foreign trade, 2010-2015

Year    Import    Export
    Volume (kt)    Value (US$ million)    Volume (kt)    Value (US$ million)
2010    225    878.873    44    164.834
2011    231    902.310    45    168.580
2012    240    921.283    50    182.295
2013    271    988.690    49    174.499
2014    315    1 114.116    49    172.104
2015    286    929.680    47    158.310



Major types of nylon 66 chips in China’s marketplace include fiber grade chips and engineering plastic grade chips. The major consumption of nylon 66 chips is in making engineering plastics, mainly for use in the machinery, electronic/electric and automobile sectors. Plastic alloys blended and modified with engineering plastics such as ABS and PC are in high demand, as are nylon products reinforced by inorganic or carbon fibers. Around 60% of the nylon 66 chips used in China go into making engineering plastics, and around 40% are used in making fibers.

Foreign Trade

In 2015, China’s total trade volume of nylon 66 chips was 333 kt, a drop of 3.7% from the previous year. The total trade value was US$1 087.99 million, a drop of 15.4%. The total import volume of nylon 66 chips in China declined to 286 kt in 2015, down 9.3% YoY, mainly because domestic output increased. The import value was US$929.68 million, a drop of 16.6%. The export volume was 47 kt, a slight drop from the previous year. The export value was US$158.31 million, a drop of 8.0%. Table 3 shows import and export of nylon 66 chips by China in recent years.
The main sources of China’s imported nylon 66 chips in 2015 included the United States, Canada and Singapore. Shanghai was the primary import destination, accounting for 42.1% of the total volume.  
The main export destinations for China’s nylon 66 chips were Hong Kong, Korea and Japan in 2015. Guangdong was the biggest export region, accounting for 18 kt or 38.8% of the total. Shenzhen Customs accounted for 36.6% of the total export volume in China.

Market price

China’s market prices of nylon 66 chips fell steadily in 2015. The prices of high-end nylon 66 chips from Asahi Kasei increased from RMB25 000/t at the beginning of 2015 to highest peak of RMB26 000/t from late March to early and mid-April and then dropped all the way to the year’s low of RMB22 350/t at the end of the year. The average price of RMB25 682/t in March and the average price of RMB25 667/t in April gave way to an average price of RMB25 000/t at the end of the year. The whole-year average price of high-end nylon 66 chips from Asahi Kasei was RMB23 986/t.
The development of nylon engineering plastics in China is quite rapid in recent years. The amount of nylon 66 chips used in nylon 66 engineering plastics is however still very small, because of a shortage of nylon 66 salt in China. Nylon 66 resin has to be imported to meet market demand. The development prospects of manufacturing high-grade nylon engineering plastics in China are therefore very bright. Pushed by the rapid development of the consumer market, with the automotive sector in the lead, demand for nylon 66 resins in the manufacture of engineering plastics and their alloys increases annually at over 10%. With the rapid growth of nylon engineering plastics and the sustained expansion of demand for nylon fibers, both the output and the sales volume of nylon 66 chips in China are expected to keep growing in the next few years.