2021 Annual POM Market Development Report

Polyoxymethylene is an engineering plastic with excellent performance, including homopolyoxymethylene and copolyoxymethylene. Different production processes can produce different kinds of homopolyoxymethylene and copolyoxymethylene. At present, China mainly produces copolyoxymethylene products. Polyoxymethylene is mainly used in electronics and electrical appliances, in addition to consumer goods, automobile industry, machinery industry and other fields also have applications.

Analysis of World POM Trade

In 2019, the total international trade of polyformaldehyde reached US$2.22 billion, a decrease of 5.2% year-on-year; the total trade volume was 1.078 million tons, an increase of 0.6% year-on-year. In terms of price, the average export price of POM in the world in 2019 was US$2057.0/ton, a year-on-year decrease of 5.8%. China, Belgium and Germany are the world's main importing countries of POM, and their total imports account for about 45.5% of the world's total imports. South Korea, Germany and Malaysia are the main exporting countries, and their combined exports account for about 42.7% of the world's total exports.

Status Quo and Forecast of China's POM Supply and Demand

In recent years, China's POM industry has developed steadily, with fewer new production facilities, and both production capacity and output fluctuate within a certain range. Many of China's products are low-end and mid-range products with a severe oversupply, while high-end products still rely heavily on imports. Currently, more than 300,000 tons of polyoxymethylene products need to be imported every year.

As of the end of 2020, there were 11 polyoxymethylene production enterprises in China, and their production capacity increased by 7.8% year-on-year. China's POM production capacity is relatively scattered, Chongqing, Yunnan, Henan, Inner Mongolia, Jiangsu, Ningxia, Shandong, Shanghai, Tianjin and Hebei all have POM production facilities.

China is a net importer of polyformaldehyde. In 2020, China's imports of polyformaldehyde decreased by 3.1% year-on-year, and imports decreased by 4.8% year-on-year. The import of polyformaldehyde is dominated by general trade and processing trade with imported materials. In 2020, the general trade volume of POM in China will account for 66.8% of the total imports; the processing trade with imported materials will account for 20.0% of the total imports. According to the statistics of import sources, China's imports of polyformaldehyde in 2020 will mainly come from countries or regions such as Taiwan, South Korea and Malaysia, accounting for about 76.4% of total imports. In 2020, China's export volume of polyformaldehyde is relatively small, mainly to Hong Kong, Japan, Vietnam, etc., mainly through processing trade and general trade.

In 2020, China's apparent consumption of polyformaldehyde increased by 1.9% year-on-year, and the self-sufficiency rate increased by 2.0% year-on-year. In China's POM consumption structure, electronics and electrical appliances are the most important consumer field. In 2020, the consumption of POM will account for about 43% of the total POM consumption. In addition, it is also applied in the fields of consumer goods, automobile industry, and machinery industry. The proportions were 21%, 16% and 8% respectively.

In recent years, China's new POM production capacity has been relatively small. In June 2020, Yankuang Lunan Chemical Co., Ltd. added a second production line of 40,000 tons/year. National de-capacity will accelerate the reshuffle of the low-end POM field. In the next two years, there is limited news about new polyformaldehyde installations. The new projects are mainly the 60,000 tons/year project of Inner Mongolia Jiutai New Materials Co., Ltd. and the 60,000 tons/year project of Xinjiang Yunjutian New Materials Co., Ltd.

The sluggish development of the market environment in 2020 will have a greater impact on the demand sector. With the gradual deepening of national tax and fee reduction policies, coupled with the release of the RCEP signal to boost consumer confidence, the risk of corporate capital pressure is reduced, and terminal demand will be released to a certain extent in the next two years. It is estimated that the average annual growth rate of China's apparent consumption of polyformaldehyde from 2018 to 2022 is about 2.3%.