Will there be oversupply of EVA in China inthe future?

 The first 200,000 tons/year EVA project of Dushanzi Tianli Hi-TechPetrochemical in cooperation with Xinjiang and CNPC successfully producedqualified products of EVA foam TL-V1803 on September 25 after only 8 days sincethe full process was successfully opened on September 16, 2022, creating thefastest record of similar units in China.

   This is also the second new EVA plant to be started up in 2022. Beforethat, on March 3, 2022, Zhongke Refining started up a 100,000 tons/year EVAplant to start up the whole process and produce EVA products, marking asuccessful start-up of the plant.

   In addition, 2022 is also planned to start the device, respectively,Gulai Petrochemical 300,000 tons / year device, Shenghong Refining 300,000 tons/ year device, the estimated 2022 new EVA plant capacity of 900,000 tons.

   2023 plans to start the device are: Ningxia Baofeng three 250,000 tons /year device, Yulongdao refining and chemical integration 700,000 tons / yeardevice, the estimated 2023 new EVA plant capacity of 950,000 tons.

   According to incomplete statistics, the next five years, China EVA newproject size of more than 1.6 million tons / year, if all these projects areput into operation, China's EVA production capacity will grow to about 3.5million tons / year.

   In addition, almost every month there are new EVA project information,the next five years, a conservative new production capacity of 1.6 million tons/ year, an optimistic assessment will exceed 2 million tons / year.

   As can be seen from the above, optimistic estimates of downstreamdemand, the next five years, China's photovoltaic industry consumption of EVAin about 1.5 million tons, shoe foam industry consumption of EVA in about 1million tons, wire and cable industry consumption of EVA in about 600,000 tons,other industries optimistic estimates of EVA consumption in about 300,000 tons.These industries have a total consumption of EVA in 3.4 million tons, withChina's conservative estimate of 3.5 million tons of capacity, with anoptimistic assessment of the capacity of 3.8 million tons there is a gap.

   According to the information currently available statistics, optimisticestimates, China's EVA industry will remain basically flat in the next fiveyears, but the need for self-balancing after the replacement of the scale ofimports. If the scale of imports again, China's EVA market may appear to beoversupplied. If there are still new projects to be built in the future,consumption and because of various unpredictable reasons and significantlyreduced, then China's EVA industry will have a high probability of oversupply,the overall view is cautiously optimistic.