[Basic Chemicals] A look back at major events in the C3 industry chain in 2023
With China's propylene industry diversifying its feedstocks, propylene sources have gradually expanded from the early naphtha cracking and catalytic cracking gas separation to propane dehydrogenation, light hydrocarbon cracking, coal-to-chemicals, and methanol-to-olefins. This feedstock diversification has been a key driver of the rapid growth of China's propylene capacity. At the same time, it has also accelerated the possibility of propylene oversupply, making the market supply-demand environment tough.
In 2023, PDH added more than 4 million tons, and in 2024 new additions will exceed 7 million tons. According to statistics, by the end of 2023, China's PDH industry had added more than 4.5 million tons/year, with 8 companies starting up and commissioning in 2023—a key driver of the rapid growth of China's propylene industry. By the end of 2023, China's total PDH capacity had exceeded 17 million tons/year, with the 2023 additions accounting for 28% of the total. It's fair to say that the rapid growth of China's PDH industry is the main force driving the overall growth of China's propylene capacity. It is expected that by 2024, more than 7 million tons of propylene capacity will still be added, at which point China's PDH capacity will break through 24 million tons/year, and total propylene capacity will exceed 74 million tons/year, continuing to hit record highs. In my view, PDH has been the main driver of propylene capacity growth over the past five years and will remain so for the next three. However, as supply grows, propane prices have clearly surpassed butane prices, further increasing the operating costs of PDH units. In addition, the rapid expansion of PDH capacity has intensified the supply-demand environment for propylene and downstream products, leaving the PDH industry in a poor economic state with low operating rates, and there is a possibility of further deterioration in the future.
Sierbang Petrochemical's total acrylonitrile capacity exceeded 1 million tons/year. According to relevant data, by December 2023, Sierbang Petrochemical's fourth acrylonitrile unit was commissioned, with a capacity of 260,000 tons/year, bringing its total acrylonitrile capacity above 1 million tons/year and making it the world's largest acrylonitrile producer and the world's largest acrylonitrile production base. By the end of 2023, China's total acrylonitrile production capacity reached 4.4 million tons/year, with Sierbang Petrochemical accounting for 24%—the world's largest acrylonitrile producer. Acrylonitrile is an important basic raw material for ABS units, and its capacity growth is a key driver of the ABS industry's growth. As the world's largest producer, Sierbang Petrochemical, leveraging its scale advantage, is rapidly influencing the global acrylonitrile industry landscape with its acrylonitrile products, and its future say will continue to grow.
ABS units added nearly 2 million tons/year of new capacity in 2023. According to statistics, China's ABS industry added nearly 2 million tons/year of capacity in 2023, with total capacity exceeding 7.7 million tons/year, continuing to hit record highs. The rapid growth of the ABS industry is inseparable from the rapid expansion of acrylonitrile capacity, as many acrylonitrile producers have downstream supporting ABS units. In addition, due to investment threshold restrictions, the barriers to entry for ABS are relatively high, so most capacity is concentrated in the hands of medium-to-large-scale enterprises, limiting the entry of many small companies.
Comments
0