ChinaNational ChemicalInformation Center

CNCIC Consulting

Review and Prospect of Chinese Market of Phenol and Acetone

CPIC Singapore 18th April, Singapore, April 2013

GraceZeng
DeputyManagerDirector CNCIC zengsn@cncic.gov.cn

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Copyright CNCIC Consulting


ChinaNational ChemicalInformation Center

CNCIC Consulting

CONTENT
Current status of China phenol/acetone industry Forecast for China phenol/acetone industry Conclusions


ChinaNational ChemicalInformation Center

CNCIC Consulting

Current status

China accounted for 12% of g global phenol p capacities p and 15% global g phenol p consumption.
WORLD PRODUCTION OF PHENOL PHENOL-2012 2012
Other Regions 9%

WORLD CONSUMPTION OF PHENOL-2012

Other Regions 8%

United States 26% Other Asia 32%

United States 21%

Other Asia Oth A i 30%

China 15% China 12%

Western Europe 23% Western Europe 24%

Producers of phenol are mainly located in Asia, United States and Western Europe In 2012, global phenol capacity was 10750kt/a; Chinese phenol capacity was 1295kt/a In I 2012, 2012 global l b l phenol h l consumption ti was9600kt; 9600kt Chi Chinese phenol h l consumption ti was 1470kt
Source: CNCIC


ChinaNational ChemicalInformation Center

CNCIC Consulting

Current status

China accounted for 11% of g global acetone capacities p and 21% global g acetone consumption.
WORLD PRODUCTION OF ACETONE-2012 ACETONE 2012
Other Regions 10% United States 26%

WORLD CONSUMPTION OF ACETONE ACETONE-2012 2012

Other Regions 11% United States 19%

Other Asia 30%

Other Asia 26%

China 21%

China 11%
Western Europe 23% Western Europe 23%

Around 90% of acetone is produced through cumene process. Another 10% of acetone is produced through IPA dehydrogenation process and by-product of cresol manufacture from cymene In 2012, global acetone capacity was 6750kt/a; Chinese acetone capacity was 785kt/a In 2012, global acetone consumption was 5950kt; Chinese acetone consumption was 1240kt
Source: CNCIC


ChinaNational ChemicalInformation Center

CNCIC Consulting

Current status

All of p phenol/acetone in China is produced p through g cumene process. p

Producing 1t of phenol can co-produce around 0.62t of acetone j technology gy p providers include KBR ( (1230kt), ), Mitsui Chemicals ( (260kt) ) Major and UOP (590kt)

Benzene 0.855 t Cumene 1.315 t Propylene 0.5 t

Phenol 1t Acetone 0.62 t


ChinaNational ChemicalInformation Center

CNCIC Consulting

Current status

Chinese p phenol/acetone capacity p y increased rapidly p y in recent years. y

CHINESE PHENOL/ACETONE CAPACITY FROM 2002 TO 2012

kt/a

CAGR15.3% CAGR12%

CAGR of global phenol/acetone capacity was 3% from 2007 to 2012 By the end of 2012, the capacity of phenol in China is 1.3 million tons and that of acetone is roughly 800 kt
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Source: CNCIC


ChinaNational ChemicalInformation Center

CNCIC Consulting

Current status

By y the end of 2012, there were 8 p phenol/acetone producers p in china.

Sinopec Beijing Yanshan company260kt/a

Bluestar Haerbin 120kt/a Jilin Petrochemical company120kt/a Sinopec/SABICTianjin company 350kt/a Lihuayi Group350kt/a

Sinopec Shanghai Gaoqiao company360kt/a Shiyou Chemical320kt/a HuiZhou Chung Shun p y200kt/a Chemical company

Source: CNCIC


ChinaNational ChemicalInformation Center

CNCIC Consulting

Current status

Share of state-owned company p y in Chinese p phenol/acetone producers p decreased gradually from 2006.
TYPES OF PHENOL/ACETONE PRODUCERS IN CHINA

Sinopec accounted for 56% of phenol/acetone capacity p y Chinese p in 2011, but in 2012 it fell to 38%

PHENOL/ACETONE CAPACITY OF STATE-OWNED COMPANY IN CHINA-2012

PHENOL/ACETONE CAPACITY OF FOREIGN FUNDED COMPANY IN CHINA-2012

State-owned Company Name Sinopec PetroChina ChemChina Lihuayi Group Sub-total Capacity (kt/a) 795 120 120 350 1385 %in Total 38 6 6 17 67

Foreign Funded Company Name Kingboard SABIC Sub-total Capacity (kt/a) 520 175 695 %in Total 25 8 33


ChinaNational ChemicalInformation Center

CNCIC Consulting

Current status

There has always y been a supply-demand pp y gap g p in the phenol p market and the foreign dependence was 40% in 2012.
OUTPUT AND DEMAND OF PHENOL FROM 2002 TO 2012 IN CHINA

kt

CAGR8% CAGR16%

Chinas demand for phenol has been steadily increasing over last 10 years In 2012, Chinas phenol demand stood at 1.5 million tons

Source: CNCIC


ChinaNational ChemicalInformation Center

CNCIC Consulting

Current status

Supply-demand pp y gap g p of phenol p decreased 21% in 2012.

SUPPLY-DEMAND GAP OF PHENOL IN CHINA
kt

Gap=Demand-Output Phenol import by countries (2012): Thailand (18%), Spain (16%) Japan (16%), J (14%) , Taiwan T i Province (14%) and Singapore (12%) LOCATION OF SUPPLY-DEMAND GAP OF PHENOL IN CHINA

Supply-demand gap was mainly located in Jiangsu Province, Province Shandong Province, Province Zhejiang Province and Fujian Province Supply-demand gap in these 4 provinces , accounting g for 65% of total. was 370kt/a,

Source: CNCIC


ChinaNational ChemicalInformation Center

CNCIC Consulting

Current status

There is a strong g demand for acetone in China and the foreign g dependence p reached 56% in 2012.
OUTPUT AND DEMAND OF ACETONE FROM 2002 TO 2012 IN CHINA

kt

CAG 9% CAGR CAGR20%

In 2012, Chinas acetone demand stood at over 1.2 million tons There has been a larger supply-demand gap in the acetone market than phenol

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ChinaNational ChemicalInformation Center

CNCIC Consulting

Current status

Supply-demand pp y gap g p of acetone decreased 7% in 2012.

SUPPLY-DEMAND GAP OF ACETONE IN CHINA
kt

Acetone import by countries (2012): Taiwan Province (23%), (21%), ) Thailand United States ( (11%), Korea (10%) and Belgium (9%)

LOCATION OF SUPPLY-DEMAND GAP OF ACETONE IN CHINA

Supply-demand gap was mainly located in Jiangsu Province, Shandong Province, Zhejiang Province , Fujian Province, Guangdong Province and Jilin Province Supply-demand gap in these 6 provinces was 400kt/a, 400kt/a accounting for 58% of total. total
Source: CNCIC

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ChinaNational ChemicalInformation Center

CNCIC Consulting

Current status

What foreign g investors are concerned about is if there will still be a large g supply- demand gap of phenol/acetone in China in the future.
SUPPLY-DEMAND GAP OF PHENOL IN CHINA
kt

SUPPLY-DEMAND GAP OF ACETONE IN CHINA

kt

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ChinaNational ChemicalInformation Center

CNCIC Consulting

CONTENT
Current status of China phenol/acetone industry Forecast for China phenol/acetone industry Conclusions

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ChinaNational ChemicalInformation Center

CNCIC Consulting

Forecast

Capacity p y expansion p of phenol/acetone p is expected p to be over 4000kt/a.

Construction Unit Capacity (kt/a) 400 400 480 480 160 200 350 200 650 480 320 4220 Phenol (kt/a) 250 250 300 300 100 125 220 125 400 360 200 2630 Acetone (kt/a) 150 150 180 180 60 75 130 75 250 220 120 1590 Location Schedule Finish Time 2013 2013 2013 2013 2014 2014 2014 2014 2015 2015 2017
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Shanghai Sinopec Mitsui Chemicals CEPSA Formosa Chemicals & Fibre Changchun Group Xinjiang Datang Jiulong Qidong Sedin New Materials (CNCEC) Jiangsu Yangnong Chemical group Sinopec Beijing Yanshan company INEOS Phenol Jiangsu Haili Chemical Industry Beijing Huifuyuan Total

Shanghai Shanghai Liaoning Jiangsu Xinjiang Jiangsu Jiangsu Beijing Jiangsu Jiangsu Xinjiang