Development forecast of methanol-to-olefin chain related varieties in 2021

At present, China’s methanol production capacity is 91.68 million tons, an annual increase of approximately 3%. Part of the new capacity this year is expansion of existing projects, part of supporting olefins, and part of plans in integrated refining and chemical projects; there are still many new projects in the future. In particular, some of the MTO supporting methanol plants in the Northwest are scheduled to be put into operation at the end of this year and early next year, which will have a greater impact on the market. In terms of demand, new additions were limited during the year. Only one set of MTO in Jilin was put into production. The traditional downstream growth rate is very limited, and most industries are under adjustment. This year, the price of methanol hit a record low. In the process of a sharp decline in product prices, upstream companies often lose money. Under this background, the high-cost production areas of methanol in the future are expected to realize the replacement of new and old capacity, and it will also accelerate the elimination of the industry. With backward production capacity, it is expected that the number and total number of failed methanol production capacity in my country this year will be higher than in previous years. Next year, new methanol projects at home and abroad are still underway, and attention should be paid to the progress of the Northwest MTO supporting methanol project, while the downstream demand side olefins growth rate slows down, and the supply of methanol varieties is still relatively loose. These will suppress the rebound of product varieties.

Olefins (ethylene + propylene)

At present, China's ethylene production capacity is about 33.91 million tons, and the annual growth rate is expected to be 18%. Most of the new production capacity comes from large-scale refining and chemical integration projects, including Hengli Petrochemical, Polaris and Debaser, Sinochem Quanzhou and Zhongke Refinery. In the future, domestic ethylene production capacity will still be further released. According to incomplete statistics, about 6.5 million tons of ethylene production capacity will be put into operation in 2021 (including Yantai Wanhua). Among the new production capacity, foreign-owned enterprises, joint ventures, private enterprises, and local refineries have entered the game one after another, and the competition has become more intense. At the same time, the phenomenon of product homogeneity will also intensify. Due to the lack of independent innovation capabilities, the main downstream polyethylene field is still lacking in independent technology, high-end products are still highly dependent on foreign sources, and the impact of low-cost imported sources on the market will continue. exist. In addition, the increase in domestic supply and export sales has also brought a certain impact on Asian ethylene prices, and the price has a greater resistance to breaking through. It is expected that the fluctuation range in 2021 will be maintained at 700-1,000 US dollars/ton.

At present, China's propylene production capacity is close to 43 million tons, mainly PDH and steam cracking. In the past two years, propylene production capacity has entered a blowout period, refining and chemical integration projects are surging, upstream and downstream supply pressures are increasing, and downstream products are expanding. Focus on polypropylene. In general, the supply of propylene has grown faster than downstream demand. Looking forward to 2021, the propylene market is still not optimistic. A large number of integration and PDH projects are expected to be launched. The market supply pressure will continue to increase. The gap between propylene supply and demand will continue to exist, but the gap will shrink year by year. The industry structure will also change, and the "seller's market" will gradually become dominant. In terms of price, propylene prices are expected to fall in 2021. The price range is expected to run within the range of 5,500-7,700 CNY/ton. The high and low prices will appear in the third quarter and the first quarter respectively. The annual average price may be 7,000 CNY/ton. nearby. With the increasingly fierce competition in the industry, extending the industrial chain and enhancing the added value of downstream products will become an inevitable choice for propylene production and development.

Ethylene oxide

At present, China's ethylene oxide production capacity is about 4.905 million tons/year (excluding some of the devices that have been built but not put into production). Although experiencing the impact of the epidemic at the beginning of the year, intensified trade disputes, plummeting crude oil prices, and stagnant import and export trade, the profitability of domestic ethylene oxide is still stable. As of the end of September, the average profit is estimated to be around 960 CNY/ton. In 2021, the domestic ethylene oxide market will still maintain a high linkage with downstream products, especially the polycarboxylic acid water-reducing agent monomer market; the ethylene glycol market has been weak throughout the year and has limited impact on ethylene oxide . In 2021, some new domestic production capacity will still be released, but there are not many new projects. It is estimated that the price of ethylene oxide will operate in the range of 6000-9000 CNY/ton. Although the impact of Asian ethylene prices on the cost of ethylene oxide has a certain degree of lag, with the release of new ethylene production capacity, cost reduction is an inevitable trend, downstream products will become more competitive, imports may gradually decrease, and exports Will increase steadily. In addition, technological innovation and industrial structure adjustment in the field of ethylene oxide deep processing may continue to be strengthened, thereby enhancing the competitiveness of downstream products and promoting the high-quality development of the industrial chain.

Methanol to olefins

At present, my country’s methanol-to-olefin production capacity has reached 15.72 million tons. In April 2020, Jilin Cornell’s new MTO project with an annual output of 300,000 tons was put into operation. The project is constructed in two phases. The construction scale of each phase is 120,000 tons of ethylene and 18 Million tons. In terms of new installations, Shanxi Coking Coal Group Feihong Chemical will adjust the construction plan of the project. In September 2019, the coal-to-methanol project will be terminated, and the olefin project and coke oven gas-to-methanol project will continue to be constructed. The remaining methanol raw materials will pass through the surrounding methanol production companies where Shanjiao Feihong is located supply. The commissioning time of the remaining new olefin plants such as Tianjin Bohua and Gansu Huating is yet to be determined. From the perspective of industry development, the industry grew rapidly from 2014 to 2015. In 2014, the growth rate was as high as 137%, and it slowed down in subsequent years. However, the production capacity growth rate in 2019 was the highest level since 2017. The growth rate will continue to slow down in the next few years.