<b>2018 MDI whole industry chain event</b>_morpholine_methylmorpholine

<b>2018 MDI whole industry chain event</b>

1. Situation and Policy

1. In 2018, the domestic environmental protection storm continued to ferment, the relocation of chemical enterprises continued to advance rapidly, and the petrochemical industry continued to improve and upgrade. Many places have successively issued a number of policies related to the environment, rectification, upgrading, and relocation of chemical parks . Some downstream enterprises with incomplete environmental protection procedures are facing penalties for rectification within a time limit or temporary shutdown.

2. On July 28, 2018, the Ministry of Ecology and Environment launched a special law enforcement action on ozone-depleting substances (ODS). The illegal use of polyurethane rigid foam blowing agent CFC-11 (trichlorofluoromethane) is a key area of law enforcement. At one time, the price of HCFC-141b (a fluorodichloroethane) blowing agent rose from 15,000 yuan/ton to 22,000 yuan/ton.

On October 24, 2018, the Ministry of Ecology and Environment, in accordance with the relevant provisions of the "Regulations on the Administration of Ozone Layer Depleting Substances" and the requirements of the phase-out plan for hydrochlorofluorocarbons (HCFCs) in China's polyurethane foam industry, stipulated that starting from January 1, 2019 , any enterprise shall not use HCFC-141b as blowing agent to produce refrigerator freezer products, refrigerated container products, and electric water heater products.

3. On May 7, 2018, the two-year-old national mandatory standard for plastic runways "Sports Fields with Synthetic Surfaces for Primary and Secondary Schools", GB 36246-2018 (hereinafter referred to as the 2018 national standard) was managed by the national standardization The committee website is officially released, and the new national standard is for TDI, MDI, HDI, MOCA and other raw material content to make more stringent requirements.

4. Since March 2018, the Sino-US trade war has continued to ferment. On September 18, 2018, U.S. President Trump announced that he would impose a 10% tariff on about $200 billion worth of Chinese exports to the United States from September 24, and threatened that if the two countries failed to reach an agreement, the The tariff rate will be increased to 25%, and the list of additional tariffs involves polymerized MDI.

Santao’s Interpretation:Under strict environmental protection inspections and ODS special rectification, the living space of small workshops is getting smaller and smaller, and downstream small workshops that do not comply with environmental protection regulations are often investigated and punished, and the demand in the distribution market is increasing. reduce. After the announcement of the new national standard in 2018, it will further weaken the use of TDI in related directions, and MDI-50 will be used as TDI will also be more widely used. It is expected that the application of MDI-50 in plastic track will increase significantly in 2018. From January to August 2018, the total export volume of polymeric MDI increased year-on-year, and the monthly export volume from July to August was also within the normal range. The Sino-US trade war has a limited impact on polymeric MDI, and the following situation needs further understanding.

2. Expansion plan and price trend

1. Lianheng Phase II 240,000 tons/year mother liquor unit and its supporting Huntsman Phase II 240,000 tons/year rectification unit were officially put into operation in January 2018, and the current load is normal.

2． Covestro plans to expand the production capacity of the 500,000 tons/year MDI plant in China to 600,000 tons/year. The project will be constructed in two phases. The first phase will be expanded to 550,000 tons/year. Realized, it is expected to be put into operation in the fourth quarter of 2018; the second phase will be expanded from 550,000 tons/year to 600,000 tons/year.

3． In March 2018, Wanhua Chemical announced that in the next three years, Wanhua Chemical will expand the production capacity of several existing MDI devices in China through technological improvement: Ningbo Wanhua will increase from the current 1.2 million tons/year to 1.5 million 10,000 tons/year, Wanhua Yantai Industrial Park increased from the current 600,000 tons/year to 1.1 million tons/year.

4． On October 19, 2018, the Fujian Provincial Development and Reform Commission issued the "Reply on the Approval of the 400,000-ton/year MDI Project of Fujian Cornell Polyurethane Co., Ltd.", agreeing to build the 400,000-ton/year MDI project of Fujian Cornell Polyurethane Co., Ltd. The project is constructed in two phases: the first phase will build a 400,000-ton MDI project, supporting the construction of 55,000 tons/year of formaldehyde and 100,000 tons/year of hydrogen chloride treatment equipment (calculated as 100% Cl2); the second phase will build 480,000 tons/year of nitric acid Benzene, 360,000 tons/year aniline, 270,000 tons/year nitric acid plant and related supporting facilities.

5． Shanghai Huntsman Polyurethane Co., Ltd. plans to increase the production capacity of prepolymers to 200,000 tons/year. The project is scheduled to start construction in June 2019, and will be completed and put into operation in January 2020, with a construction period of 8 months.

6． In October 2018, Covestro announced that it would invest 1.5 billion euros inBuild a world-class MDI factory in Dun, and build a new 500,000-ton/year production line, which is expected to be put into operation in 2024. At the same time, the old 90,000-ton/year production line will be closed. In 2024, Covestro's total MDI production capacity in the United States is expected to reach 740,000 tons/year .

7． The price of polymeric MDI dropped from about 26,000 yuan/ton at the beginning of the year to about 12,600 yuan/ton, a drop of more than 50%. At the same time, the price of pure MDI fell from 31,000 yuan/ton at the beginning of the year to 22,000 yuan/ton, a drop of about 50%.

Santao’s Interpretation:In 2018, the global MDI installations operated stably, the output growth rate was faster than the demand growth rate, and the market was weak. From 2019 to 2022, China will add 1.3 million tons of MDI capacity per year, which is equivalent to a compound growth rate of about 10% in the next three years. At present, the overall growth rate of the demand side may be difficult to reach 10%, and the domestic overcapacity situation will Intensified, the future market competition will be more intense, and exports will become a more important sector.

Third, MDI Downstream Major Events

1. According to national statistics, from January to September 2018, my country produced a total of 60.167 million refrigerators, a year-on-year decrease of 19%. The sales volume of refrigerators was 23.157 million units, a year-on-year decrease of 7.7%. From January to September 2018, my country produced a total of 12.609 million freezers, a year-on-year decrease of 13%.

2． According to the statistical analysis of the China Association of Automobile Manufacturers, from January to September 2018, the production and sales of automobiles were 20.4913 million and 20.4906 million, a year-on-year increase of 0.87% and 1.49%.

Santao’s Interpretation:The output of refrigerators and freezers has decreased, the output of automobiles has increased, and the development of the cold chain industry has accelerated; The growth rate of slurry sole resin slowed down, spandex TPU industry is growing rapidly. Therefore, the downstream consumption structure has changed compared with last year. Automobiles, cold chains, spandex, TPU industry will become the main driving force for the growth of MDI demand.

New production capacity is constantly being released on the supply side, market competition will become more intense, and exports will become a more important sector. How about the increase in production and exports? Under strict environmental protection inspections and ODS special rectification, the living space of downstream small workshops is getting smaller and smaller. What changes have taken place in the downstream consumption structure and the main driving force of demand growth? Please refer to the 2018 China MDI Market Report provided by Suntower Consulting!

2018 MDI whole industry chain event

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