By Xiao Ming

Production

China’s capacity of polyamide 6 (PA6) has increased stably in recent years. By the end of September 2023, it had reached 6.8 million t/a, with East China and South China accounting for a combined 86.1% (see Figure 1, Figure 2 and Table 1 for more details). Besides constructing downstream supporting units, many firms – e.g. Sinopec Baling Petrochemical Co., Ltd., Fujian Jinjiang Technology Co., Ltd., Fujian Shenyuan New Materials Co., Ltd., etc. – have built caprolactam units to ensure access to raw materials.

Figure 1 China’s PA6 capacity from 2018 to September 2023

Figure 2 China’s PA6 capacity distribution at the end of September 2023

Consumption

Growing in recent years, domestic apparent consumption of PA6 increased by 0.8% YoY to 4.04 million tons in 2022, and by 9.43% YoY to 3.02 million tons in the first eight months of 2023 (see Figure 3 for more details). Around 59% of PA6 was consumed by civil filament firms, and 14% by engineering plastics enterprises, both in 2022. Other downstream industries in 2022 mainly included industrial polyamide silk (8%), bidirectional stretch nylon film (5.7%), short fiber (5.4%), heddle (1.8%), microfiber (1.7%) and carpet (0.7%).

Prices

Domestic PA6 prices are most impacted by prices of raw material caprolactam, and other influence factors mainly contain supply, demand, import prices, etc. From 2018 to 2022, China’s PA6 prices fell first, and then increased. Overall, prices in the first nine months of 2023 were lower than prices in 2022, peaking at RMB14 200/t in February 2023 and declining to the lowest of RMB13 400/t in July 2023. For a certain period of time, domestic prices of PA6 are forecast to fluctuate slightly, given relatively stable demand from downstream sectors, rising supply of both caprolactam and PA6, etc.

Development trends

1) Domestic PA6 capacity will continue to rise, and is forecast to exceed 10 million t/a in 2027, exacerbating overcapacity and leading to more intense competition. Many PA6 units will come on stream from 2023 to 2027, e.g. a 1.2 million t/a unit of Guangxi Hengyi New Material Co., Ltd., a 600 000 t/a unit of Cangzhou Risun Chemical Co., Ltd., a 450 000 t/a unit of Jiangsu Hongsheng New Materials Co., Ltd., etc.

2) New PA6 projects will be located mainly in East China and South China – two areas which are home to a large amount of both PA6 producers and consumers.

3) In spite of decelerated development of downstream industries, domestic PA6 consumption is forecast to keep rising, and may reach around 4.6 million tons in 2027, with new demand still from areas of civil filament, industrial filament, engineering plastics, etc.

4) Rising PA6 capacity will gradually decrease the volume of imports, but demand for high-quality PA6 will rely on foreign goods continually. Export volume of PA6 is expected to grow, effectively relieving domestic supply and demand contradiction.

5) PA6 prices are forecast to decrease slightly, given that PA6 output will grow more rapidly than downstream demand.

6) PA6 production units will be improved in many aspects like scale, energy consumption, quality, etc., thus leading to lower production costs and higher economic benefits.

Suggestions

PA6 enterprises should expand capacity reasonably to avoid blind competition, improve existing technologies to lower consumption of energy and materials, and develop techniques to recycle unreacted monomer from PA6 production to further reduce production costs. Furthermore, research on homemade technologies for PA6 production units should be paid attention to, as a way to propel both economic benefits and competitiveness of PA6 companies.

High-performance products (e.g. PA6 with high viscosity, modified PA6 composites, etc.) should be developed. High-end product customization is recommended to meet requirements of different customers. Other suggestions mainly include expanding export, and boosting anti-risk capabilities of firms via reorganization, merger, upstream and downstream integration, etc.