Polyamide & Intermediates

Transcription

1 Polyamide & Intermediates Tecnon OrbiChem Seminar at KICHEM 212 Seoul - 2 November, 212 Darrel Collier

2 WORLD CAPROLACTAM CAPABILITY vs DEMAND 1, Metric Tons Forecast Growth 2.8% pa 6, 5,5 5, 4,5 Capability to produce 4, 3,5 3, 2,5 Growth 3.4% Growth 3.% Growth 2.7% pa Annual Caprolactam Consumption

3 WORLD CAPROLACTAM CAPABILITY vs DEMAND 1, Metric Tons 6, 5,5 Effect of unscheduled plant downtime , 4,5 Capability to produce 4, 3,5 3, 2,5 Growth 3.4% Growth 3.% Growth 2.7% pa Annual Caprolactam Consumption

4 CAPROLACTAM CAPACITY ktpa Guangdong 8 Fujian Baling, Hunan Hengyi, Zhejiang 3-2 BASF DSM Ube Honeywell CPDC Capro Corp Sumitomo Lanxess Leuna C.I.S Poland Others Braskem MCC Sinopec Bohui Group Shandong Hongye 215 or later Additions 214 Additions 213 Additions 212 Additions 211 Additions Closures 29-1

5 CHINA CAPROLACTAM & PA6 POLYMER CAPACITY 1, Metric Tons CPL Capacity by end-211 (ktpa) Sinopec Baling 2 3, DSM Nanjing 2 2,5 2, Shijiazhuang Refining 165 Zhejiang Juhua 25 Total 59 1, New CPL Projects ktpa Start-up Time 1, Shandong Haili 1 Mar 212 Shandong Haili 1 July 212 Zhejiang Hengyi 1 end May 212 Zhejiang Hengyi 1 late July 212 Zhejiang Juhua 25 May 212 (debottleneck) CPL Capacity PA6 Polymer Capacity Shandong Hongye 1 Sep 212 Sinopec Baling 1 Nov 212 Jiangsu Bohui DSM Nanjing 2 end 213 Sinopec Fujian 2 215? Sinopec Guangdong 2 215? Total New Capacity 1425

6 CHINA PA6 APPARENT DEMAND 1, Metric Tons 2, 1,8 1,6 1,4 1,2 1, CPL Production CPL net import PA6 net import CPL Capacity PA6 Polymer Capacity PA6 Downstream Breakdown Staple 2.8% BOPA 4.6% Textile Filament 53.6% Engineering Plastics 19.1% BCF 1.6% High Tenacity filament 18.2%

7 CHINA CAPROLACTAM SUPPLY vs DEMAND 1, Metric Tons 4, 3,5 3, 2,5 2, 1,5 1, 5 Caprolactam Import PA6 Net Import Caprolactam Consumption plus PA6 net import Caprolactam Consumption Capacity Capacity on stream 215 or later Caprolactam Production ignoring post 215 new capacity

8 CHINA CAPROLACTAM SUPPLY vs DEMAND 1, Metric Tons 4, 3,5 3, 2,5 2, 1,5 1, 5 Caprolactam Import PA6 Net Import Caprolactam Consumption plus PA6 net import Caprolactam Consumption Capacity Capacity on stream 215 or later Caprolactam Production

9 GLOBAL PRODUCTION OF NYLON FILAMENT ktpa ,6 29 1,4 28 1,2 27 1, Europe inc CIS & Turkey USA China South Korea Taiwan Japan

10 POLYAMIDE FILAMENT PRODUCTION 1, Metric Tons 4,5 4, 3,5 3, China 2,5 2, 1,5 1, 5 Rest of the World 5:5 reached

11 WORLD PA6 CONSUMPTION BY END-USE 1, Metric Tons 6, 5,5 5, 4,5 4, 3,5 3, 2,5 2, 1,5 1, 5 Growth % 1.8% -2.5% 3.1% PA6 Resin Staple High Ten Yarn Bulked Carpet Textile Fibre

12 ASIAN CAPROLACTAM MARGIN over 1.3 CYCLOHEXANE +.3 AMMONIA $/ Metric Ton 4, 3,5 3, 2,5 2, Asian Caprolactam Import Contract WE 1.3 Cyclohexane +.3 Ammonia 1,5 1,

13 ASIAN CAPROLACTAM MARGIN over 1.3 CYCLOHEXANE +.3 AMMONIA $/Metric Ton 4, 3,5 3, 2,5 2, 1,5 Asian Caprolactam Import Contract WE 1.3 Cyclohexane +.3 Ammonia Margin over Feedstocks 1,

14 ASIAN CAPROLACTAM MARGIN over 1.3 CYCLOHEXANE +.3 AMMONIA $/Metric Ton 4, 3,5 3, 2,5 2, 1,5 1, 5 Asian Caprolactam Import Contract WE 1.3 Cyclohexane +.3 Ammonia Margin over Feedstocks and Energy Energy Requirement

15 ASIAN CAPROLACTAM MARGIN over 1.3 CYCLOHEXANE +.3 AMMONIA $/Metric Ton 4, 3,5 3, 2,5 2, 1,5 Asian Caprolactam Import Contract WE 1.3 Cyclohexane +.3 Ammonia Fixed Costs 1, Energy Requirement Cash Flow Energy plus Fixed Costs

16 CASH FLOW SHOWN BY AN ASIAN CAPROLACTAM MODEL PLANT $/Metric Ton 4, 3,5 3, Cash Flow 2,5 2, 1,5 1,

17 DEPENDENCE OF ASIAN CAPROLACTAM PRODUCTION COST ON CRUDE OIL PRICE $/ton Caprolactam 3,5 3, 2,5 Cats & Chemicals Fixed costs of supplying plants Energy related costs (steam, ammonia, etc.) Delivery Cost of Production in Asia (low wage country) Fixed costs of caprolactam plant 2, 1,5 Packing, loading Energy dependant costs 1, Cyclohexane Brent Crude oil price $/bbl

18 DEPENDENCE OF CAPROLACTAM PRODUCTION COST ON CRUDE OIL PRICE $/ton Caprolactam 4, 3,5 3, 2,5 2, Cats & Chemicals Packing, loading Fixed costs of supplying plants Profit zone Delivery Energy related costs (steam, ammonia, etc.) Cost of Production in Asia (low wage country) Fixed costs of caprolactam plant Energy dependant costs 1,5 1, Cyclohexane Crude Oil Price $/bbl

19 CAPROLACTAM CASH COST INDUSTRY CURVE May 212 Cash Cost ($/ton) 35 3 Each Column Represents an Existing Caprolactam Plant Cumulative Capacity (ktpa)

20 ASIAN CAPROLACTAM IMPORT CONTRACT vs BRENT CRUDE OIL PRICE CORRELATION Asian Caprolactam Import Contract $/ton 4, 3,5 3, 2,5 2, 1,5 1, Brent Crude Oil $/bbl

21 ASIAN POLYESTER (.865PTA +.35MEG) PRICE vs BRENT CRUDE OIL PRICE CORRELATION 3,5 3, 2,5 2, ,5 1, Brent Crude Oil $/bbl

22 ASIAN POLYESTER (.865PTA +.35MEG) & CAPROLACTAM PRICE vs BRENT CRUDE OIL PRICE CORRELATION Dollars Per Ton 3,5 3, 2,5 2, 1,5 Caprolactam PTA + MEG 1, Brent Crude Oil $/bbl

23 WORLD POLYAMIDE 66 CONSUMPTION BY END-USE 1, Metric Tons 3,5 3, 2,5 2, 1,5 Growth % PA66 Resin Staple High Ten Yarn Bulked Carpet Textile Fibre 1, 5 2.4% -1.8% 1.7%

24 GLOBAL ADIPONITRILE CAPACITY 27 Invista 56.1% Invista Victoria 26.8% 29 Invista France 16.7% Invista Victoria 26.8% 211 Invista France 16.7% BASF 7.1% Asahi 2.5% Rhodia 15.5% Ascend 18.6% Asahi 2.7% Rhodia 16.7% Ascend 2.1% Invista Orange 17.% Asahi 2.7% Rhodia 16.7% 1,61 ktpa 1,24 ktpa 1,495 ktpa Ascend 2.1% Invista Orange 17.% 72% 23% 77% 28% 6% 17% 23% Technology Hydrocyanation Acrylonitrile EDN

25 US BUTADIENE, AMMONIA & NATURAL GAS PRICES vs HMDA RAW MATERIALS COST $/Metric Ton 4, 3,6 3,2 2,8 2,4 2, 1,6 1,2 8 4 Butadiene Ammonia Methane (Natural Gas) Feedstock Costs per Ton HMDA =.58 Butadiene +.48 Ammonia +1.2 Methane

26 WORLD ADIPONITRILE CAPABILITY vs DEMAND (Capability =.95 x Nameplate Capacity) 1, Metric Tons 2, 1,9 1,8 1,7 1,6 1,5 1,4 1,3 1,2 1,1 1, 9 8 Capability to produce Growth 3.1% BASF closes 116 ktpa at Wilton, UK Invista s 254 ktpa unit at Orange, USA out of action Debottlenecking Assumed new 3 kpta plant??? Forecast Growth 2.8% Annual Adiponitrile Consumption

27 WORLD ADIPIC ACID CAPACITY vs DEMAND 1, Metric Tons 4,5 4, 3,5 Capacity to produce Forecast Growth 2.7% 3, 2,5 2, Growth 4.% Invista closes 45 ktpa at Wilton & Maitland, rebuilds Orange Annual Adipic Acid Consumption 1,

28 CHINESE ADIPIC ACID MARGIN OVER BENZENE Rmb per Ton 28, 24, 2, 16, 12, 8, Chinese Adipic Acid Margin over Benzene Chinese Adipic Acid Price Chinese Benzene Price 4,

29 CHINA ADIPIC ACID CAPACITY 1, Metric Tons Not including Kailuan Energy & Zhejiang 1,8 Shuyang 1,6 1,4 1,2 1, Driven by: Good profit Supply shortage) Available technology High profit driven Antidumping duties Over-optimistic demand Start-up date not sure Total Capacity by end ktpa Liaoyang Petrochemical 15 Dushanzi Tianli 75 China Shenma 25 Shandong Haili (Bohui) 225 Shandong Hongye 14 New Projects ktpa Start-up Time Shandong Hualu Hengsheng 75 Mar 212 Shandong Hualu Hengsheng 75 Jun 212 China Shenma 6 Oct 212 Chongqing Fuxiang 16 Jul 212 Shanxi Yangmei 8 End Aug 212 Jiangsu Bohui 15 H2 212 Shandong Hongye 14 End 212 Kailuan Engergy /214? Zhejiang Shuyang 8 212/213? Total New Capacity

30 CHINA ADIPIC ACID SUPPY & DEMAND 1, Metric Tons 1,8 1,6 1,4 1,2 1, Seriously Oversupplied situation from 212 Demand Capacity

31 ADIPIC ACID CAPACITY REGIONAL DISTRIBUTION 1, Metric Tons China Northeast Asia South & Southeast Asia East Europe West Europe South America North America , 1,2 1,4 1,6

32 WORLD ADIPIC ACID REGIONAL NET TRADE 1, Metric Tons N America S America S & SE Asia ME & Africa E Europe W Europe Possible exporting outlets, but fierce competition NE Asia China

33 CHINA ADIPIC ACID CONSUMPTION BY END-USE 1, Metric Tons 7 6 Synthetic leather resin 35.% 5 4 Polyester Polyol 4.2% Shoe sole resin 19.% % Growth Other Polyurethanes 12% Growth Plasticisers AH Salt AH Salt 23.3% Miscellaneous 4.% Plasticisers 2.4% PU Coating 1.8% TPU 7.6% PU Adhesive 1.7% 211 demand: 632, tons

34 LONG TERM AVERAGE PRICES OF FIBRE & INTERMEDIATES: CRUDE OIL AT ~ $9/bbl $/Metric Ton 3,3 3,1 2,9 2,7 2,5 2,3 2,1 1,9 1,7 1,5 1,3 1, PA6 Filament (FDY 7den) PA6 Polymer 25 Caprolactam 65 PTA Crude oil ~ $9/bbl PA6 Staple 3 11 average PA66 Staple PEs FDY 7 den PEs Staple MEG Benzene PA66 Filament (FDY 7den) PA66 Polymer 1.17 AH salt.66 AA +.52 HMDA.865 PTA +.35 MEG

35 LONG TERM AVERAGE PRICES OF FIBRE & INTERMEDIATES: CRUDE OIL AT ~ $12/bbl $/Metric Ton 4,4 4,2 4, 3,8 3,6 3,4 3,2 3, 2,8 2,6 2,4 2,2 2, 1,8 1,6 1,4 1,2 1, PA6 Filament (FDY 7den) PA6 Polymer Caprolactam 85 PTA 35 Crude oil ~ $12/bbl PA6 Staple 4 14 average PA66 Staple PEs FDY 7 den 4 13 PEs Staple PA66 Filament (FDY 7den) PA66 Polymer 1.17 AH salt.66 AA +.52 HMDA.865 PTA +.35 MEG MEG Benzene

36 CONCLUSIONS World caprolactam consumption bounced back in 21, but then slowed considerably H2 211 and H1 212; World caprolactam growth will return to trend from 212 onwards, at a long term rate of 2.8% per year The 21 recovery was due to a surge in demand from China but this resulted from a pull forward of future demand, such that 211 has seen almost zero growth in China A quick and large release of China new caprolactam capacity will lead to over-capacity over but supply and demand will return to balance by 216 if no further caprolactam plants are built Caprolactam showed excellent profitability in 21 and most of 211, but profits have collapsed in 212 as Chinese polyamide growth has faltered combined with a large and rapid expansion of Chinese capacity PA6 and PA66 will be hard pressed by competition from polyester with an increasing crude oil price

37 CONCLUSIONS PA66 producers have to grapple with high and volatile costs, especially on butadiene; High butadiene prices are likely to persist, damaging long term PA66 growth Some new investments in polyamide 66 was stimulated by good profit and short supply years ago, such as Huafeng Group (4 ktpa started up in May 211) and Guorui Chemical (5 ktpa AH salt in H1 212), but high ADN/HMDA prices and relatively slow demand mean that they are struggling Polyamide 66 resin prices in China have been decreasing in H1 212, even for a time close to the current nylon 6 resin prices, showing a big cost pressure for the nylon 66 producers Over-enthusiasm for adipic acid investment in China has led to gross overcapacity Adipic acid imports into China have been replaced -- except for high quality material -- and export opportunities are limited, so over-capacity will continue and domestic markets will be depressed for years to come Fierce competition could lead to a reshuffling in the adipic acid markets, in China and even overseas

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