Pu Consumption Scale Grew Steadily, MDI Capacity Expansion Continued Or Will Bring Price Declines.

Basic situation analysis of polyurethane industry


Polyurethane is a new organic polymer material. It is known as "the fifth largest plastics". Because of its excellent performance, polyurethane is widely used in many fields of national economy. The product application area involves light industry, chemical industry, electronics, textile, medical treatment, construction, building materials, automobile, national defense, aerospace, aviation and so on.


Pu consumption scale grew steadily, PU foam consumption biggest.


Due to the superior performance of polyurethane products and the characteristics of energy saving and environmental protection, its application scale has been expanding in recent years, and the market demand is increasing. At present, China's production of building materials, spandex, synthetic leather and automobiles ranks first in the world. The state vigorously implements the new policy of building energy conservation and the promotion of waterborne coatings, all of which bring huge market opportunities for the polyurethane industry. In 2018, the output of China's automobile industry declined, the sales revenue of furniture manufacturing industry declined, and the output declined. However, the development of building energy efficiency and rail transportation and electronic products industry was stable. The total consumption of polyurethane in China in 2018 was about 11 million 500 thousand tons.




In 2018, the largest consumption of polyurethane products in China was polyurethane foam, paint and synthetic leather size, accounting for 39.13%, 18.09% and 16.09% respectively, and other products accounted for less than 10%.



A number of research and analysis believe that the future vehicle polyurethane products will focus on five main directions. The specific circumstances are as follows:




The steady growth of downstream demand has led to the continuous expansion of polyurethane production capacity in China and the steady growth of PU production. In 2018, China's polyurethane production was about 11 million 300 thousand tons, down 4.96% compared with the same period last year. The development of upstream supply is slowing down, and the upstream supply growth is slowing down. The output is located after three major synthetic materials (PP, PVC, PE).



According to the regional supply, the distribution pattern of polyurethane in China has gradually formed four plates: first, the Yangtze River Delta region centered on Shanghai; the raw materials and products of polyurethane in the region now occupy half of the domestic market; the two is the Pearl River Delta region centered on Guangzhou, which is a region with more developed polyurethane products and foreign trade in China. The three is the Bohai rim and Northeast China centered around Huludao. The biggest advantage is that the chemical industry is strong in foundation, the industrial planning is magnificent, the varieties of polyurethane products are large, and the output is large. Four, the northwest area with Lanzhou as the center will form the downstream polyurethane product industrial chain.



MDI capacity continues to expand polyurethane prices will continue to decline


The price trend of polyurethane is closely related to the two main raw materials. Due to the continuous expansion of upstream production capacity of polyurethane raw materials, the average price of TDI and MDI, the two most important raw materials of polyurethane upstream, has been decreasing since 2013. The decline of raw materials has further brought about a decline in the price of polyurethane.


It is worth noting that with the continuous expansion of MDI capacity, polyurethane prices have a further decline.


From the perspective of MDI capacity expansion, Wanhua chemical plan will upgrade the capacity of Ningbo's 1 million 200 thousand T plant to 1 million 500 thousand T in the next 2 years, and upgrade the capacity of the 600 thousand T device in Yantai to 1 million 100 thousand T, and the total capacity will reach 2 million 600 thousand T; the COSCO plan will expand the 500 thousand tMDI device in Shanghai Caojing to 600 thousand T. By 2020, China will add 1 million 140 thousand tMDI production capacity, and with the release of BASF and Wanhua chemical MDI production capacity, China will become one of the most important exporters of MDI. The continuous expansion of MDI capacity further ensures the supply capacity of MDI, thereby promoting the possibility of further decline in Pu prices.