China’s polycarbonate (PC) capacity releases a large profit shrinkage

Dec 13, 2022

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Centralized release of polycarbonate production capacity

Driven by huge market demand, high added value of products and domestic and foreign capital and technology, planned, newly built or expanded polycarbonate projects are intensively launched in China, and the next few years will be a concentrated release period of China’s polycarbonate capacity.

Statistics show that China currently has nearly 20 polycarbonate projects under construction, with a total capacity of more than 4.6 million tons/year; It is conservatively predicted that China will release 2.41 million tons/year of polycarbonate capacity by 2023, when the total polycarbonate capacity in China will be nearly 3.6 million tons/year.

The supply and demand market of polycarbonate in China will change greatly. At present, China’s imports of more than 1 million tons of polycarbonate products are not simple substitutes. It is optimistic that the import volume of irreplaceable high-end products may reach about 500000 tons, which means that China’s polycarbonate industry will actually have excess capacity at that time.

The gap between supply and demand in the raw material market is growing rapidly

Profits shrink sharply

Bisphenol A (BPA), as an indispensable raw material for polycarbonate production, is one of the key factors in the competition of China’s polycarbonate industry.

Due to the limited capacity of new production of bisphenol A in China in the next few years, it is expected that the gap between supply and demand of bisphenol A will grow rapidly, and the competition for bisphenol A resources will become more intense. In the future, the profit margin of polycarbonate may shrink significantly under the double pressure of the sharp rise in the price of bisphenol A raw materials and the continuous decline in product prices.

Sinochem will directly obtain the synthesis and production capacity from bisphenol A to polycarbonate particles, as well as the capacity from polycarbonate particles to PC endurance board and PC sunlight board products. In this way, from the exploration and development of petroleum to the production and sales of PC endurance board and PC sunshine board products, Sinochem has controlled almost all the industrial chains of PC board in its own hands, forming the strongest PC industrial chain in the history of chemical industry.