Brief Analysis of MDI, TDI, ADI Industry

1. Introduction to isocyanate

Isocyanate is an important component required for the synthesis of polyurethane. It has one or more N=c=O functional groups on its molecule, which can be aliphatic, cycloaliphatic, polycyclic or aromatic in nature.

The most common isocyanates in industrial environments are based on molecules with two N=C=O functional groups, commonly called diisocyanates, including diphenylmethane diisocyanate (MDI), toluene diisocyanate (TDI), hexamethylene diisocyanate Isocyanate (HDI), isophorone diisocyanate (IPDI), distilled diisocyanate (NDI), etc.

Generally, we refer to isocyanate products other than aromatics as aliphatic diisocyanates (ADI), including hexamethylene diisocyanate (HDI), isophorone diisocyanate (IPDI), and dicyclohexylmethane-4 , 4'-Diisocyanate (HMDI), methylcyclohexane diisocyanate (HTDI), xylylene diisocyanate (XDI), trimethylhexamethylene diisocyanate (TMDI), tetramethyl m-benzene Dimethylene diisocyanate (TMXDI). Among them, the output of HDI products accounted for about 2/3, and the total output of HDI, IPDIand HMDI accounted for more than 85% of the global aliphatic isocyanate output.

Polyurethane materials prepared with ADI have excellent anti-aging, anti-yellowing properties, and are key basic materials supporting the development of aerospace, military, high-end equipment, automobiles and other industries. They are also green for traditional industries such as coatings, adhesives, and artificial leather. The key raw material for chemical upgrading is known as the "Pearl" in the crown of the polyurethane industry.

2. Analysis of the development status of the isocyanate industry
1.MDI

The MDI industry presents an oligopoly. The global MDI production capacity totals approximately 10.4 million tons per year. The top five manufacturers are Wanhua Chemical (2.65 million tons), BASF (1.81 million tons), Covestro (1.77 million tons), Dow Chemical (1.36 million tons) and Huntsman (1.35 million tons) have high industrial concentration, with CR5 exceeding 88%. In addition, only one local manufacturer, Wanhua Chemical, has realized industrialized production, and all other manufacturers are foreign-funded.

In the next few years, MDI's planned and under construction production capacity will be close to 3 million tons per year. Among them, Wanhua Chemical’s planned and under-construction production capacity reached 1.4 million tons per year, accounting for nearly half of the total. Therefore, Wanhua Chemical will be the main force in the expansion of MDI in the next few years; The built capacity is 500,000 tons/year and 440,000 tons/year respectively, and the remaining total is about 700,000 tons/year.

From the perspective of supply, my country's MDI production capacity has grown steadily in recent years, and the growth rate has gradually slowed down. In the future, with the release of production capacity, MDI supply will continue to grow. In terms of demand, refrigerator-freezers account for the largest proportion of downstream consumption of polymerized MDI. The export demand for refrigerator-freezers has shown a positive growth trend in the past two years, which will drive the growth of market demand for polymerized MDI.

2.TDI

(1) Overview of existing production capacity

The pattern of the TDI industry is similar to that of MDI, and it also presents an oligopoly pattern. The main manufacturers include BASF, Covestro, Wanhua Chemical, Yantai Juli and so on.

At present, the total global production capacity of TDI is about 3.7 million tons/year, and CR3 is as high as 67%. Among them, BASF is the largest producer with a total production capacity of about 920,000 tons/year, including Shanghai BASF 220,000 tons/year, South Korea BASF 160,000 tons/year, Germany BASF 380,000 tons/year and US BASF 160,000 tons/year Year; the second largest producer is Covestro, with a total production capacity of about 910,000 tons/year, including Shanghai Covestro 310,000 tons/year, German Covestro 300,000 tons/year and U.S. Covestro 300,000 tons/year Year; Wanhua Chemical is the third largest producer with a domestic production capacity of 400,000 tons/year, a Hungary base with a production capacity of 250,000 tons/year, and a total production capacity of 650,000 tons/year. Around the year, including Korea Hanwha, Japan MCNS, Cangzhou Dahua, etc.

The largest domestic producer is Wanhua Chemical, which has TDI production bases in Yantai and Fujian, with capacities of 300,000 tons/year and 100,000 tons/year respectively, with a total production capacity of 400,000 tons/year; Covestro is the No. The second largest manufacturer has a production facility of 310,000 tons/year in Shanghai; Yantai Juli and BASF are the third and fourth largest manufacturers respectively, with capacities of 230,000 tons/year and 220,000 tons/year respectively; Cangzhou Dahua, Gansu Yinguang, and Lianshi Chemical have capacities of 150,000 tons/year, 100,000 tons/year, and 50,000 tons/year respectively.

(2) New domestic production capacity

In the next few years, the new domestic TDI capacity will mainly come from Wanhua Chemical and Cangzhou Dahua.

In June 2021, Wanhua Chemical announced the environmental impact report of Wanhua Chemical (Fujian) Co., Ltd. for its 250,000-ton/year TDI project (draft for comments). According to the environmental assessment, Wanhua Chemical plans to invest about 1.9 billion yuan in the Fujian base to expand the existing 100,000-ton/year TDI project to a 250,000-ton/year project. The project is expected to be completed in 2 years. The project has not yet started.

Cangzhou Dahuamu plans to build a 400,000-ton TDI expansion and transformation project. According to the relevant environmental assessment, Cangzhou Dahua will expand and transform the original 50,000 tons/year TDI device and 70,000 tons/year TDI device to 160,000 tons/year, reaching 160,000 tons/year TDI capacity; expand a set of 225,000 tons /Year TDI device, total TDI production capacity reaches 385,000 tons/year. The project is constructed in two phases, the first phase is to build 225,000 tons/year TDI device; the second phase is to expand and transform the original 50,000 tons/year TDI device and 70,000 tons/year TDI device to reach 160,000 tons/year TDI capacity .

3.ADI

(1) Industry overview

The production process of ADI is relatively long. The production process contains complex organic synthesis, phosgenation and other processes. It is not only technically difficult, but also requires effective control of the required chlorine and toxic phosgene, so entry barriers are high. Up to now, the only companies in the world that can produce ADI on a large scale are Covestro, Evonik, Kang Rui, BASF, Asahi Kasei and Wanhua Chemical.

At present, the total global ADI production capacity is about 540,000 tons, of which Covestro has the largest production capacity, exceeding 200,000 tons/year. Wanhua Chemical's production capacity is closely followed (130,000 tons/year). In the future, with Wanhua Ningbo 50,000 tons With the commissioning of a ton/year HDI device, the gap with Covestro will narrow.

(2) Subdivided areas

In terms of products, HDI has long been dominated by foreign companies. Covestro and Kangrui are the global leaders, with a combined production capacity accounting for more than 60%. Wanhua is the only domestic supplier, and its current production capacity is second only to Covestro.

IPDI production companies mainly include five companies including Wanhua, Covestro, Evonik, Kangrui and BASF. Wanhua Chemical ranks third in terms of production capacity, but has a relatively small gap with other companies in terms of production capacity.

In terms of HMDI, currently only Wanhua Chemical, Costron and Evonik have production capacity globally. Wanhua is the first and only independent supplier of HMDI in China, with a production capacity of 20,000 tons per year compared with Covestro and Evonik.

Globally, Covestro is the inventor of aliphatic isocyanate derivatives, and its production of aliphatic and aromatic isocyanate derivatives and each aliphatic monomer (HDI, IPDI, HMDI, PDI, etc.) ranks the world leading position.

Domestically, Wanhua Chemical is the only local ADI producer.

In 2012, Ningbo Wanhua’s 15,000-ton HDI production facility was put into operation, marking Wanhua’s large-scale industrial production of ADI;

In 2016, Wanhua Construction completed the industrialization of IPDI and HMDI and put them into production, becoming one of the few companies in the world with the industrial production capacity of HDI, IPDI and HMDI three ADI monomers.

Wanhua Chemical is the only company in the world that has mastered the entire industry chain MDA-H12MDA-H12MDI, the second in the world to master the entire industry chain IP-IPN-IPDA-IPDI, and the only domestic company that has mastered core technologies such as HDI and derivatives.

At present, Wanhua Chemical's total ADI production capacity is 130,000 tons/year, accounting for 24% of the world’s total. It is estimated that 50,000 tons/year HDI will be put into production in 2023, and its total ADI production capacity will reach 180,000 tons/year. While continuing to expand the production capacity of ADI products, Wanhua is also building a special amine-ADI-PUD industry chain to promote the integrated development of the ADI industry.

summary

Due to high technical requirements and large capital investment, domestic isocyanate producers are extremely rare. For most products (except TDI), only Wanhua Chemical has large-scale production capacity, and the rest are foreign capital.

With the completion and commissioning of domestic isocyanate-related projects, my country has become an important global aliphatic isocyanate manufacturing site. The domestic isocyanate industry chain has been improved, but it is also facing the problem of surplus of low-end products and insufficient supply of high-end products, and due to technology With high barriers, the probability of new entrants in the isocyanate industry in the future is small, and Wanhua Chemical will become the main force in the development of the isocyanate industry.