Wanhua/BASF/Covestro/Kumho Mitsui/Juli New MDI production capacity of nearly 3 million tons
Views：905 Updated：2022-05-18
On May 8, Wanhua Chemical (Ningxia) Company's 300,000 tons/year diphenylmethane diisocyanate (MDI) separation project officially started.
The total investment of the project is 487 million yuan. It is located in the coal chemical industry park, Ningdong energy and chemical industry base. The construction period is 12 months. The construction content is 300,000 tons/year of separated MDI products. The MDI transported by Wanhua Chemical Yantai production base With the mixture of polyphenyl polymethylene polyisocyanate (PAPI) (hereinafter referred to as PM-100) as raw material, pure MDI and polymerized MDI are separated by rectification process, which are the most important products for the surrounding enterprises in Ningdong and the west side of the plant. Star Spandex (Ningxia) Co., Ltd. provides raw materials.
High technical barriers to production
Isocyanate is the part with the highest technical requirements, the largest investment and the highest profitability in the polyurethane industry chain. As the main raw material for the preparation of polyurethane materials, the production process of MDI involves the most dangerous reactions in the chemical industry such as phosgenation, nitrification, and hydrogenation, and the control of the reaction process and product separation are very difficult; at the same time, due to MDI, toluene diisocyanate (TDI) and other isocyanate products are highly reactive products, which are easy to react with moisture and have a low freezing point. Therefore, very high requirements are placed on the control of the entire production process, and the technical barriers are extremely high. MDI can be called one of the bulk products with the highest comprehensive barriers in the chemical industry, and it is a rare product with a market exceeding 100 billion yuan.
Since Bayer developed the industrialization technology of polyurethane in 1937, the MDI industry has developed rapidly, and the production capacity and output have increased rapidly. Currently, MDI production technology is the sixth generation, and Wanhua Chemical's seventh generation technology is under development.
From the perspective of downstream applications, the most important applications of MDI worldwide are in the construction industry and the reaction injection model industry, of which the construction industry accounts for 52% of the downstream demand for MDI, and the reaction injection model industry accounts for 13% of the downstream demand for MDI.
Compared with other thermal insulation materials (such as EPS and XPS), polyurethane board has better performance, but the price is more than double. The use of polyurethane as a wall insulation material in foreign countries started relatively early, and more than 50% of the downstream is used in the construction industry.
my country's polymerized MDI is mainly used in refrigerators, cold storage, building insulation, automobiles and other fields, while the application of pure MDI is concentrated in synthetic leather, shoemaking, and textile industries. With the country's continuous emphasis on building environmental protection and automobile lightweight, my country's MDI consumption structure is gradually changing to internationalization.
The top five companies occupy more than 88% of the market share
Because MDI has high technical barriers, high capital barriers, complex technology, and difficult production management, MDI production technology has been blocked in the hands of giants, thus restricting new entrants to the industry, and the global supply of MDI is in an oligopolistic situation.
At present, the total global MDI production capacity is about 10.41 million tons/year, and the top five producers are Wanhua Chemical (2.65 million tons/year), BASF (1.81 million tons/year), Covestro (1.77 million tons/year), Dow Chemical (1.36 million tons/year) and Huntsman (1.35 million tons/year) have a high degree of industrial concentration. These five companies together account for more than 88% of the market share.
At the beginning of the 21st century, the only manufacturer of MDI in my country was Wanhua Chemical, and the domestic MDI demand needed to be met by a large amount of imports. With the rapid economic development after my country's accession to the WTO, the supply of MDI is in short supply, the global operating rate once exceeded 100%, and the price soared. In order to meet the increasing demand, many companies such as Wanhua Chemical, Shanghai Lianheng, and Bayer have invested in new or expanded MDI factories in my country. Dow also has new production capacity in the United States and BASF in Belgium.
By the end of 2021, there are only five domestic MDI producers, Wanhua Chemical, BASF, Covestro, Tosoh and Huntsman (Shanghai Lianheng is a joint venture between BASF and Huntsman), with a total production capacity of 4.58 million tons/year , compared with the end of 2020, an increase of 500,000 tons/year, an increase of 12.3%, the new production capacity is mainly from the MDI capacity expansion technical transformation project (500,000 tons/year) of Wanhua Chemical Yantai Industrial Park. In terms of production capacity ratio, Wanhua Chemical (2.3 million tons/year) still ranks first, accounting for 53.2%, followed by BASF (610,000 tons/year), Covestro (600,000 tons/year) and Shanghai United Heng (590,000 tons/year), Huntsman and Japan Tosoh have production capacities of 400,000 tons/year and 80,000 tons/year respectively.
The planned production capacity under construction is nearly 3 million tons per year. In the next few years, the proposed and under construction production capacity of MDI will be nearly 3 million tons per year. The new production capacity will mainly come from Wanhua Chemical, BASF, Covestro and other enterprises. Among them, Wanhua Chemical's planned and under-construction production capacity will reach 1.4 million tons/year, accounting for nearly half of it. Therefore, Wanhua Chemical will be the main force for MDI's expansion in the next few years; Covestro and BASF plan to build and The construction capacity is 500,000 tons/year and 440,000 tons/year respectively, and the rest total about 700,000 tons/year. 1. Wanhua Chemical
Wanhua Chemical's existing/planned MDI projects are mainly located in Ningbo base and Fujian base. Wanhua Chemical (Fujian) MDI Industrial Park project is located in Jiangyin Gangcheng Economic Zone, Fuqing. The first phase is to build a new MDI project with an annual output of 400,000 tons. The project has officially started in March 2020, and the large-scale equipment installation will start on August 21, 2021. The ceremony will be completed in September 2022, and qualified MDI products will be produced by the end of 2022.
The west area of Wanhua Fujian Industrial Park will rely on Jiangyin Chemical New Materials Zone, take advantage of good world-class ports and supporting industrial chain clusters, and will form a production capacity of 1.6 million tons/year of MDI when all completed, radiating to South China and Southeast Asia markets. Wanhua's Fujian base will also become the company's third largest production base after Yantai and Ningbo. If all Wanhua's planned or under-construction MDI production capacity is put into production, Wanhua's total global MDI production capacity will reach 4.85 million tons, and its global market share is expected to be It has risen to more than 35%, and its leading position in the industry has been further consolidated.
In May 2021, Wanhua Chemical's official website announced that Wanhua Chemical (Ningbo) Co., Ltd. plans to implement the MDI/HDI technical transformation and capacity expansion integration project in the existing plant at No. 39 Huandao North Road, Daxie Development Zone, Ningbo. ton/year MDI technical transformation project.
Wanhua Chemical has expanded and transformed the existing MDI plant, and finally expanded the capacity of the first-phase MDI plant from the existing 400,000 tons/year to 600,000 tons/year, and the second-phase MDI plant capacity from the existing 800,000 tons/year Expansion to 1.2 million tons/year, with a total production capacity of 1.8 million tons/year of MDI; Wanhua Chemical also plans to build a new 280,000-ton/year modified MDI production unit, with a total capacity of 300,000 tons/year Modified MDI production capacity.
In addition, Wanhua Chemical has announced that it will build a 400,000-ton/year MDI project in the United States. Currently, the project is still under planning.
2. BASF
BASF's ongoing and proposed MDI projects are mainly the 90,000-ton/year MDI refining expansion project of BASF in Shanghai and the MDI capacity expansion project of the Verbund plant in Geismar, Louisiana, USA.
On October 9, 2021, the Shanghai Municipal Bureau of Ecology and Environment announced the impact assessment information of the MDI refining and expansion project of Shanghai BASF Polyurethane Co., Ltd. before submitting for approval. The total planned investment of the project is 340 million yuan, and the MDI production capacity is 90,000 tons/year refining device and supporting storage tank area. The project is scheduled to start in January 2022 and be completed and put into production in August 2023.
In addition, the MDI expansion project at BASF's Verbund plant in Geismar, Louisiana, is progressing as planned.
The first phase, the construction of a new MDI synthesis unit, has been completed and operational. Meanwhile, an old MDI synth set is no longer in use.
Construction of the second phase, currently underway, will see BASF expand several upstream units, increasing total MDI production at the Geismar complex by approximately one-third.
After the construction of the project is completed, BASF's MDI production capacity at the Geismar plant will reach 600,000 tons/year.
3. Covestro
On September 28, 2021, Covestro announced that it intends to build a world-scale MDI factory after suspending plans to build a unit in the United States in early 2020.
Covestro said the plant is expected to be operational in 2026, two years later than the initial forecast start date, and the plant's capacity may also be around 500,000 tons per year as originally forecast.
Separately, Covestro's 50,000-tonne/year ramp-up project at its Tarragona plant in Spain is still underway, but is expected by 2025, rather than 2022 as originally estimated when the project was first announced in late 2017.
4. Kumho Mitsui
In April 2021, Kumho Mitsui Chemicals said it would invest about 400 billion won ($358.1 million) to expand its chemical manufacturing plant in the southwestern region of South Korea.
A joint venture between South Korean synthetic rubber maker Kumho Petrochemical and Japan's Mitsui Chemicals said its shareholders approved an investment plan to expand a methyl diphenyl diisocyanate (MDI) plant in Yeosu, 455 kilometers southwest of Seoul.
Kumho Mitsui Chemicals said that when the expansion is completed in 2024, Kumho Mitsui Chemicals' MDI annual production capacity will increase from the current 400,000 tons to 610,000 tons, which is expected to increase sales by more than 1.5 trillion won.
5. Yantai Juli
Xinjiang Heshan Juli (a subsidiary of Yantai Juli) MDI project with an annual output of 400,000 tons is located in the existing factory of Xinjiang Heshan Juli Chemical Co., Ltd., Kuidong Characteristic Industrial Park, Kuitun-Dushanzi Economic and Technological Development Zone. The total planned investment of the project is 4,664.24 million yuan. The main construction content and scale are 400,000 tons/year MDI project production units. The MDI synthesis method adopts phosgenation method. On January 19, 2020, the Xinjiang Development and Reform Commission announced the project before approval.
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, MDI supply will continue to grow as production capacity is released.
From the perspective of demand, the largest proportion of downstream consumption of aggregated MDI is refrigerators and freezers. The growth trend of export demand for refrigerators and freezers in the past two years is improving, which will drive the growth of aggregated MDI market demand.
