SPC Plans to Invest 3.196 Billion Yuan to Expand Carbon Fiber Production Base

Shanghai Petrochemical (SPC) announced that it will invest about 3.196 billion yuan to expand its large-tow carbon fiber production capacity. The company will target the field of wind turbine blades, and will also meet the application needs of rail transportation, civil reinforcement and low-altitude aviation industries.

The project will be implemented in two phases. The production of precursor, a key component of carbon fiber production, will be expanded in SPC's existing plant in Jinshan District, Shanghai. The expansion will increase the production capacity of large-tow precursor by 60,000 tons/year.

The second phase of carbon fiber production will be located in Sulige Economic Development Zone, Ordos City, Inner Mongolia. The new plant will produce 30,000 tons of large-tow carbon fiber per year. SPC plans to establish a new wholly-owned subsidiary, Inner Mongolia Xinjinshan Carbon Fiber Co., Ltd., with a registered capital of 20 million yuan, to manage the Inner Mongolia business. The project is expected to be completed within three years.

Precursor production in the Shanghai plant enables SPC to fully utilize its existing infrastructure, technical expertise and human resources. In addition, it can obtain a stable supply of key raw material acrylonitrile from the nearby East China production center, and the downstream carbon fiber factories in Inner Mongolia benefit from the region's abundant energy resources, supportive local policies, sound industrial infrastructure, and competitive energy and labor costs. The raw yarn produced in Shanghai will be directly supplied to the Inner Mongolia factory, ensuring the consistency and controllability of the supply chain.

SPC's investment is in line with national and local industrial policies to promote the development of advanced materials. It also supports Shanghai Petroleum's broader strategy from refining to chemicals, to materials, and finally to high-end products.

SPC has identified the wind turbine blade market as the main target for its large-tow carbon fiber products, but also sees great potential in rail transportation and civil reinforcement, and is actively seeking opportunities in low-altitude aviation.