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Analysis of current situation of chemical industry

Jul 28, 2023

According to data from the China Petroleum and Chemical Industry Federation, China’s refining capacity reached 920 million tons last year, and ethylene production capacity reached 46.75 million tons/year, ranking first in the world. The industry has said that it is necessary to be alert to the signs of chemical overcapacity, strengthen the monitoring of hot chemical production capacity expansion, and avoid a rush of blind investment.
Ethylene has long been regarded as a key indicator to determine the production level of the chemical industry. In 2022, China is already the world’s largest ethylene producer, and it is expected that soon, China’s ethylene production capacity will exceed 70 million tons, which will likely cause serious surplus problems. At the same time, ethylene industry is the core of the petrochemical industry, its products account for more than 75% of petrochemical products, occupies an important position in the national economy.
As the core of the petrochemical industry, ethylene or excess, marking the petrochemical industry is facing reshuffle and differentiation, not only competitive enterprises to eliminate backward enterprises, advanced production capacity to eliminate backward production capacity, but also the demise and rebirth of ethylene downstream industry chain segmentation leaders. Ethylene, propylene, butadiene, benzene, toluene, xylene, ethylene oxide, ethylene glycol, etc. produced by ethylene plant are the basic raw materials in the field of new energy and new materials, and large refining and chemical integration enterprises produce ethylene, the production cost is relatively low, compared with the same scale of refining enterprises, refining and chemical integration enterprises can increase the added value of products by 25%. Energy consumption has been reduced by about 15%.
Using ethylene as raw material can produce polycarbonate, lithium electric diaphragm, photovoltaic EVA, α-olefin, POE (polyolefin elastomer), carbonate, DMC, ultra-high molecular weight polyethylene (UHMWPE) and other new material products. According to statistics, there are 18 kinds of ethylene downstream products associated with new energy, new materials and other tuyere industries, due to the rapid development of new energy vehicles, photovoltaic, semiconductor and other new energy and new industries, the demand for new material products continues to increase.