<b>Under the new policies for automobiles and home appliances, what is the downstream demand for aggregated MDI in 2019? </b>_morpholine_methylmorpholine

<b>Under the new policies for automobiles and home appliances, what is the downstream demand for aggregated MDI in 2019? </b>

In order to thoroughly implement the spirit of the Central Economic Work Conference and promote the formation of a strong domestic market, recently the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Commerce and other ten ministries and commissions jointly issued "Further Optimizing Supply and Promoting Stable Consumption The Implementation Plan for Promoting Growth and Forming a Strong Domestic Market”, put forward 24 specific measures in six aspects, in order to conform to the general trend of residents’ consumption upgrade and better satisfy the people’s yearning for a better life. Two of them are closely related to the downstream of polymeric MDI, automobiles and home appliances.

Among them, the automobile policies are mainly as follows: (1) Promote the scrapping and renewal of old automobiles in an orderly manner. (2) Continue to optimize the subsidy structure for new energy vehicles. (3) Promote the replacement of rural vehicles. Where conditions permit, rural residents may be given appropriate subsidies to scrap three-wheeled vehicles and purchase trucks with a capacity of 3.5 tons or less or passenger vehicles with a displacement of 1.6 liters or less to drive rural car consumption. (4) Steadily promote the relaxation of restrictions on pickup trucks entering the city. (5) Accelerate the prosperity of the second-hand car market. (6) Further optimize local government motor vehicle management measures.

It is reported that in 2018, the number of cars per 1,000 people in my country is about 170, which is still far behind the level of car ownership in major developed countries. About 500-600 vehicles. Therefore, automobiles still have great growth potential in the future.

At the same time, the number of cars owned by rural residents in my country is very low at present, and many residents in rural areas still rely on three-wheeled vehicles with low safety standards, or even some electric mopeds that have not been legally registered. Therefore, this "Implementation Plan" also proposes to promote the replacement of rural cars and guide the upgrading of rural car consumption. This will also boost car consumption.

According to statistics, the amount of polyurethane products used in a domestic mid-level car is 15-20 kg, but the amount of polyurethane products used in high-end cars can reach 25-30 kg. If the amount of polyurethane products per car can be increased by 10 kg, the corresponding amount of MDI is 3-4 kg. Based on the current annual production of more than 20 million cars, the demand can increase by more than 100,000 tons. A slow process with limited short-term impact. On the whole, Tiantian Chemical Network predicts that the consumption of MDI in the automotive industry may increase by 5% in 2019, driving the overall consumption of polymerized MDI to increase by about 0.7%.

The home appliance policy mainly includes: (1) Support the sales of green and smart home appliances. (2) Promoting the replacement of home appliances. Where conditions permit, consumers can be given appropriate subsidies for selling old home appliances (refrigerators, washing machines, air conditioners, televisions, range hoods, water heaters, stoves, computers) and purchasing new home appliances to promote sales of high-quality new products. (3) Actively carry out consumption poverty alleviation to drive product sales in poor areas.

At present, my country's refrigerator market is basically saturated, and the main consumption point in the future is replacement and upgrading. According to CMM’s offline monthly monitoring data, in 2017, when the retail sales of the overall refrigerator market fell sharply by 11.4%, the market for high-end refrigerators priced above RMB 8,000 bucked the trend and rose by as much as 26.5%. Although the growth rate in 2018 has slowed down on a higher base, it still maintains a growth rate of more than 20%, with a share of 9.1%. Under the new policy, the overall pace of transformation and upgrading of refrigerators may be accelerated. It is estimated that the consumption of MDI in this industry may increase by 2% in 2019, driving the overall consumption of polymeric MDI to increase by about 1%.

Other industries such as adhesives, pipes, sheets, soft foam and high resilience continued to grow, while the spraying and water heater industries continued to shrink. Overall, the consumption of polymeric MDI in 2019 may maintain a growth rate of around 4%.

Under the new policies for automobiles and home appliances, what is the downstream demand for aggregated MDI in 2019?

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