(1) Overall development of the international chlorinated polyethylene industry: In the 1960s, Hoechst Company in Germany took the lead in producing the chlorinated polyethylene product Hostalit in the world, which was later renamed Hostapren. Subsequently, in 1967, Tyrin CPE and Tyrin CM from Dow Chemical in the United States, Elaslen from Showa Electric in Japan in 1968, and Daisulac from DAISO in Japan in 1969 were successively put into production. In April 1996, DuPont Dow Elastomers L.L.C. (referred to as DDE), jointly established by Dow Chemical and DuPont, had a production capacity of 76000 tons per year of chlorinated polyethylene. In 2010, due to the impact of macroeconomic environment, Dow Chemical's 56000 ton/year chlorinated polyethylene plant in the United States ceased production. At present, the enterprises producing chlorinated polyethylene in the world are mainly concentrated in China.
The regional distribution of chlorinated polyethylene consumption in the world is mainly concentrated in countries and regions such as China, the United States, India, Europe, and South America. Worldwide, due to the successful replacement of chlorosulfonated polyethylene rubber (CSM), chloroprene rubber (CR), nitrile rubber (NBR) and other products by chlorinated polyethylene in the rubber industry, its production and application in wires and cables, rubber hose and tape are showing an increasing trend year by year. With the continuous improvement of the cost-effectiveness of chlorinated polyethylene, the demand for its use in plastic profiles in various countries is increasing, leading to an upward trend in the demand for chlorinated polyethylene.
Chlorinated polyethylene is mainly used in PVC plastic products, wires and cables, transportation belts, automotive and industrial hoses, sealing strips, waterproof rolls, foam products, rubber products, magnetic strips, thermoplastic elastomers and other fields worldwide.
(2) Overall development of the domestic chlorinated polyethylene industry: China has been developing chlorinated polyethylene since the 1950s. Jiangsu Taicang Additive Factory, Anhui Chemical Research Institute, Hubei Chemical Research Institute and other units have successively carried out research and development work on chlorinated polyethylene. In the early 1970s, Anhui Provincial Institute of Chemical Industry conducted the first aqueous suspension pressure chlorination test of polyethylene, and in 1983, a 1000 ton chlorinated polyethylene industrial production unit was built. In 2001, the new production process of chlorinated polyethylene developed by Anhui Research Institute of Chemical Industry passed provincial appraisal. Currently, the production technology of chlorinated polyethylene in China is mature. After decades of development, China's chlorinated polyethylene industry has become a world leader. At present, China has become the world's largest producer of chlorinated polyethylene. Most of the domestic chlorinated polyethylene production enterprises are concentrated in the Shandong region, accounting for about 52% of the total domestic production capacity. Among the production enterprises, Keli Chemical and Yaxing Chemical have the greatest influence. Yaxing Chemical relocated and ceased production in 2019, and temporarily constructed a CPE device with an annual production capacity of 50000 tons. The shutdown of Yaxing Chemical provides opportunities for the development of other small and medium-sized enterprises.
(3) Upstream and downstream situations of the industrial chain:
② Upstream situation of the industrial chain:
A. HDPE is the main raw material for chlorinated polyethylene products, and the price of HDPE is closely related to the price of crude oil, so the uncertainty of crude oil price will be transmitted to chlorinated polyethylene. Chinese HDPE production enterprises have accelerated the pace of device transformation and expansion, with some device capacities approaching economies of scale, but the distribution of production areas is uneven. At present, the production capacity of domestic HDPE devices is mainly concentrated in the Northeast, North China, and East China regions, which are also the main consumer markets for HDPE in China. With the development of the chlorinated polyethylene industry, the application fields of chlorinated polyethylene are constantly expanding. Different application fields require it to have corresponding properties (such as color, flame retardancy, and electrical properties), and new and higher requirements are constantly put forward for the performance of raw materials. There is still a certain gap between domestically produced HDPE powder and imported products in terms of particle size distribution and morphology, which also limits the technological level of developing high-performance chlorinated polyethylene in China. The scale of domestic HDPE production capacity is large, but the quality and specification cannot meet the production requirements of high-quality and multi brand chlorinated polyethylene. Therefore, a large number of special HDPE used for the production of chlorinated polyethylene are imported from South Korea (mainly including Samsung, LG Chemical) and Taiwan, China (mainly Formosa Plastics Group) every year.
B. Chlorine, another main raw material for the production of chlorinated polyethylene, is a chartreuse gas at normal temperature and pressure. It can be liquefied into golden yellow liquid chlorine after compression. It is one of the main products of the chlor alkali industry. As a strong oxidant, it can be replaced or addition reaction with organic and inorganic compound substances to produce a variety of chlorides. Liquid chlorine in China is mainly used by chlor alkali enterprises for self use, and is currently mainly used in industries such as pharmaceuticals, dyes, pesticides, papermaking, metallurgy, and fungicides. The changes in raw material costs, transportation conditions, and the supply-demand relationship in the market all have an impact on the price of liquid chlorine.
③ Downstream situation of the industrial chain:
A. The downstream PVC products have a wide range of applications and the industry is developing rapidly. In the "post epidemic era", the national infrastructure has been strengthened, and the significant increase in demand for PVC products has objectively driven the application demand of chlorinated polyethylene in PVC impact modification. With the further promotion of new national building standards and the increasing use of building pipelines, the application of plastics in building materials is driving the demand for impact modifiers in the fields of hard PVC pipes, PVC profiles, PVC sheets, and pipe fittings.
B. Wire and cable: parallel insulated flexible wire and light and medium-sized rubber sheathed flexible cable, general rubber flexible cable sheath, mining cable sheath, flame retardant cable sheath, and marine cable sheath.
C. Rubber hose: mainly used for rubber hose around automobile engine, such as heat and oil resistant hydraulic steering gear rubber hose, automatic transmission fluid cooler rubber hose, suction rubber hose and fuel rubber hose. It has been widely used in the inner and outer layers of oil resistant hydraulic hoses and woven (wrapped) or cloth sandwiched pneumatic hoses.
D. Tape: flame-retardant conveyor belts for mining, V-shaped belts, etc.
E. Waterproof rolls: vulcanized and non vulcanized waterproof rolls.
F. Molded products: automotive rubber products and electrical rubber accessories.
G. Sealing strips: Sealing strips for cars, trains, and containers.
(4) Analysis of industry competition pattern:
1) Industry competition pattern and main market participants: The production of chlorinated polyethylene in the world is mainly concentrated in China, and international enterprises that have produced chlorinated polyethylene have also reduced their production capacity in recent years. At present, the main enterprises in China that can produce chlorinated polyethylene include Hangzhou Keli Chemical Co., Ltd., Shandong Sanyi Group Co., Ltd., Weihai Haida Plastic Co., Ltd., and Yaxing Chemical. Hangzhou Keli Chemical Co., Ltd. has an annual production capacity of 150000 tons of chlorinated polyethylene, far surpassing the ranking enterprises in terms of production capacity scale.
2) Industry competition characteristics: Chlorinated polyethylene is a polymer, a type of fine chemical industry, and belongs to a technology intensive, talent intensive, and service intensive industry. The fine chemical industry belongs to a fully competitive industry. Compared with other industry products, its downstream industry chain has the longest extension and downstream customers cover the widest range of industry fields, resulting in the fine chemical industry having strong self-improvement ability in production processes, energy conservation and environmental protection, and technological innovation. At the same time, due to the wide variety of fine chemical product segmentation, it is difficult for oligopolistic enterprises to appear in all or most product categories with advantages. Taking BASF in Germany as an example, its overall product catalog has tens of thousands of types, but only over a hundred are actually produced and occupy a dominant position in the market. Industry characteristics indicate that the fine chemical industry as a whole is dominated by small and medium-sized enterprises, with relatively fixed customers and suppliers as a loose combination, and has a certain or high market share in the field of segmented products. Overall analysis, in recent years, China's fine chemical industry has shown the following competitive characteristics:
① The preliminary and complete establishment of the fine chemical industry system: the main raw materials for the production of fine chemical products are basic chemical products. After years of development, China's chemical industry has established a relatively complete chemical industry system, with a complete variety of chemical products. Some important raw materials have a large production capacity and output base, and the output of more than ten major chemical products ranks among the top in the world. The complete industrial chain system of China's chemical industry enables the fine chemical industry to receive sufficient and affordable raw material supply, abundant human resources, and lower labor factor costs domestically, giving China's fine chemical industry a certain comparative advantage in international development. Some important raw material production enterprises have a large production capacity and output base, And there are more than ten main chemical products with output ranking among the world's top.
② Comparative competitive advantage highlights: China's chemical industry has a solid foundation, low labor costs, and a significant comparative advantage internationally. The further transfer and concentration of the world's fine chemical industry to China will bring rare opportunities for the development of China's fine chemical industry.
With the development of domestic education, scientific research, and industrial economy, China has a large number of researchers with strong research and development capabilities and skilled technical workers with operational experience. Fine chemical production enterprises have reached international advanced levels in certain fields of technology and processes. Thanks to continuous breakthroughs in process technology, abundant supply of domestic chemical raw materials, and complete industrial chain support, China has become an important producer and consumer of low-carbon fatty amines globally.
③ Single product has ceiling limitations: The characteristic of the fine chemical industry is the wide variety of chemicals, and the limited demand capacity of the single product market, which can easily lead to some enterprises occupying a high market share within their dominant products despite being small in scale, production, and competitors. As a result, the development space of enterprises is limited, facing pressure and demand for a variety of product types.
④ Enterprises in the industry are facing increasing pressure on environmental protection, and the market concentration ratio has further improved: in recent years, with the gradual tightening of China's environmental protection policies, some chemical enterprises with serious pollution, substandard emissions, lack of production qualifications and approval procedures have withdrawn from the market, and the market gap left by their withdrawal is being rapidly occupied by competitors in the same industry and enterprises that have expanded upstream and downstream industrial chains, To some extent, it has enhanced the overall strength and industrial chain integration ability of some enterprises, and the market concentration ratio has improved.
(5) Industry development opportunities:
① PVC is widely used downstream and the demand scale continues to expand: PVC has excellent performance in mechanical, chemical, and other aspects, and its price is low, but its impact strength, thermal stability, and processing performance are poor. However, the ability of PVC to accept modification has made it stand out in practical applications, with a wide range of performance applications ranging from soft products to hard products. As a result, PVC once became the world's largest producer of general-purpose plastics, with its products mainly divided into two categories: soft products and hard products. PVC soft products are widely used in wires and cables, packaging films, auxiliary materials, artificial leather, hoses, sealing materials, and coatings, while PVC hard products are also used in various profiles such as doors and windows, pipes, hard sheets, bottles, and so on.
Analysis of PVC Consumption Structure in China in 2021
② The concentration ratio of the PVC industry continues to increase, and the balance between supply and demand gradually improves to promote the prosperity of the industry. With the deepening of the national supply side reform and the increasingly strict environmental protection policies, the backward production capacity of the PVC industry continues to accelerate the exit, the new production capacity tends to be reasonable, and the industry concentration continues to increase. Under the stable growth of downstream demand, the supply-demand balance of the PVC industry has improved, the project operating rate has continued to increase, and the overall prosperity of the industry has also benefited. The upstream additive industry has also entered a stable development stage.
③ Benefiting from the growth of downstream demand, the PVC additive industry has developed steadily and steadily. With the upgrading of national safety and environmental policies, the continuous improvement of people's living standards, and the implementation of resource conservation and new urbanization plans, the insufficient demand in the domestic market of the PVC modifier industry has been improved to a certain extent, promoting the development of the PVC modifier industry. Firstly, PVC decorative panels, PVC foam panels, PVC flooring, PVC shoe materials, synthetic resin tiles, and other products have the characteristics of flame retardancy and formaldehyde free, meeting the increasing demand for safety and environmental protection. With the upgrading and upgrading of technology, related products will continue to meet and surpass the needs of consumers, and the market has broad development space; Secondly, building energy conservation, as an important component of energy conservation and emission reduction, has been highly valued. Plastic profiles are recognized as energy-saving materials. With the strong promotion of policies such as replacing wood with plastics and steel with plastics, the demand for plastic profiles is expected to continue to grow in the future; Thirdly, the planning of new urbanization construction, the renovation of urban pipeline network construction, and the large-scale construction of livelihood projects all have significant development space for the pipe industry as a whole. In addition, as China's economic development enters the "New Normal" and the supply side reform policy is further implemented, driven by multiple factors such as stricter environmental protection policies, upgrading customer demand and intensifying market competition, some small and medium-sized enterprises will gradually withdraw from the market. The industry has entered an extraordinary period of adjustment and upgrading, and industry concentration ratio is expected to further improve.
It is predicted that by 2025, the global demand for PVC will increase at an annual growth rate of 3.2%, with the Asia Pacific region still the largest PVC sales market so far, accounting for nearly 56% of the global total consumption, and remaining the region with the fastest growth rate of PVC demand in the future. At present, China has become a major plastic country in the world, with the production capacity, output, and consumption of PVC products ranking first in the world. The market demand for PVC hard products and packaging materials such as various pipes, profiles, plates, sheets, and foam boards, as well as decorative and decorative products, as well as PVC soft products such as rolled film/leather, wires, cables, latex gloves, and children's toys, has further expanded, and has broad development potential, This is conducive to further promoting the demand for chlorinated polyethylene products.
