Rongsheng Petrochemical Expands Its Product Portfolio Again, Causing Korean Chemical Industry to Feels Crisis

Rongsheng Petrochemical, China's largest petrochemical company, will expand its petrochemical product portfolio again in 2024, including intermediate raw materials and synthetic resins.

Petrochemical industry sources said on January 10 that Rongsheng Petrochemical will invest US$12.2 billion to build a refinery in China's Zhoushan Islands to develop refining and petrochemical projects, including a 3 million tons/year catalytic cracking unit and a 1 million tons/year separation unit and an aromatics extraction plant with an annual production capacity of 600,000 tons. 

Rongsheng Petrochemical emphasized that it will obtain an annual output of 300,000 tons of refined ethylene oxide (EO), 1 million tons of ethylene vinyl acetate, 200,000 tons of polyolefin elastomer (POE), 400,000 tons of phenol, and 250,000 tons of acetone.

In addition, Rongsheng Petrochemical will produce 400,000 tons of propylene oxide (PO), the basic raw material for polyurethane; 800,000 tons of styrene monomer, the intermediate raw material; 500,000 tons of 1,4-butanediol, the raw material for spandex; 120,000 tons of antioxidant raw material isobutylene. While a carbon dioxide capture device with an annual capture capacity of 150,000 tons will be built.

Rongsheng Petrochemical's expansion project includes the main products of Korean petrochemical companies. For Korean petrochemical companies, the most amazing point is Rongsheng Petrochemical's development in the field of synthetic resins. It will build a production facility with an annual output of 1.2 million tons of ABS, which Korean companies such as LG Chem, Lotte Advanced Materials and Kumho Petrochemicals are producing. The company will also build two polycarbonate production facilities to ensure a total output of 520,000 tons. ABS is a durable and workable material used on the exterior of a variety of electronic products. Until 2021, LG Chem was the global leader in the ABS business.

Since 2024, the Korean oil industry has had a strong sense of crisis, especially since Lotte Chemical sold all of its general petrochemical production plants in China in 2023 because the expansion of China's general petrochemical plants has weakened its price competitiveness. Lotte Chemical now is restructuring its operations to increase production of high value-added products.