China is recognized as a big chemical country, and the vast majority of chemical production capacity has ranked first in the world. However, the world's top 50 chemical companies have only Sinopec on the list, which inevitably gives people a sense of being big but not strong. Some even think that China’s leading companies can only reach overseas comparable companies in the 50’s and 60’s in the next few years.

After more than 20 years of development, China’s chemical industry has accumulated considerable strength. Especially in recent years, technology has been increasing rapidly. Various sub-industries have continuously put world-class devices into production. Both in terms of scale and advancedness, they all rank among the world's leading companies. With substantial improvements, future technology upgrades will be faster. In the same period, European and American enterprises were subject to the impact of the financial crisis. Capital expenditures were generally curtailed, the installations kept aging, new product research and development also stagnated, and the advantages to China were greatly reduced. At present, China's chemical industry has reached the critical point of full competition with Europe and the United States. In the next 10 years, there will be a number of leading enterprises to achieve catch-up and surpass the overseas chemical powers, and China will also emerge as a world-class chemical powerhouse!

China's chemical industry is catching up with all-round

In addition to the foregoing, China's various sub-sectors in the chemical industry have all overtaken the situation, many companies have already occupied a leading position in the world. For example, in the vinyl acetate industry, China Weixiu High-tech Co., Ltd., China's boulder in the glass fiber industry ranks first in the world; Dongyue and Juhua in the fluorine chemical industry are the world’s second- and third-generation refrigerant largest companies; Kangde New Coating Co., Ltd. has achieved the first in the world and is still in the field of optical film; Huafeng Spandex in the spandex industry and Black Cat in the carbon black industry rank second in the world and the titanium dioxide industry Lee also rose to the fourth place in the world.

For example, Kim Jong-ta and Stanley in the compound fertilizer industry, Yufeng and Lotus in the MSG industry, Brother Technology and Guangji Pharmaceutical in the vitamin industry, Sanlux and Shengao in the rubber products industry are all among the best in the world. Competitive business. In fact, there are many examples like this. It can be said that China's excellent chemical companies that have surpassed international standards have gradually emerged from the spark of the stars. The era of China's chemical industry is approaching.

Where are the core advantages of China's chemical industry?

Looking at the development of China's chemical industry over the past 30 years, it started from the initial urea, methanol, soda ash, chlor-alkali, and tires, and gradually expanded to midstream chemicals such as triene triphenyl, MDI, acrylic acid, engineering plastics, silicones, etc. Began to extend to higher-end electronic chemicals, fine chemicals, new energy, new materials, etc., manufacturing capabilities have become increasingly complex, and their status in the value chain has also increased.

It can be said that every breakthrough of a sub-industry's technical barriers will absorb knowledge, duplicate technology, and innovate in a very short period of time. Ultimately, it will rely on market size and cost advantage to achieve the world's first, and then rely on it. Continuing to conquer the next sub-industry, the whole industry chain is advancing very alarmingly.

The entire industry chain has obvious advantages

Looking to the future, few blind spots in China's industrial chain are being quickly filled. For example, in the past three years, cheap propane resources brought about by the United States shale gas revolution have been used. China has built a new 5-million-ton PDH plant and achieved self-sufficiency in propylene. The scale even exceeds the U.S. counterparts that are closer to the resources. In the future, we will also use the opportunity of U.S. ethane exports to massively increase the production capacity of ethane cracking and further achieve ethylene self-sufficiency. In addition, PX, which has been plaguing China for many years, will be highly reliant on imports through the construction of new large oil refineries, and will basically fill the last few shortcomings in China's upper reaches.

If the future oil price rises back to more than 80 US dollars / barrel, China's unique coal chemical technology is also expected to bend overtaking, becoming the world's most competitive upstream process. In addition, we have also made rapid breakthroughs in the midstream areas such as SAP, PMMA, butyl rubber, TDI, PC, waterborne coatings, and chlorination titanium dioxide, and have emerged a number of high-quality companies.

Terminal market capacity is obvious

China’s population is as large as 1.4 billion, which is four times that of Europe and the United States, seven times that of Japan and Russia, and the per capita GDP is more than 8,000 US dollars per year. It is also that it continues to grow at a rate of 10% per year. The annual income of 400-400 million people in coastal developed provinces has reached the level of moderately developed countries, and their spending power is not inferior to that of Europe and the United States.

From the experience of our neighboring countries, Japan and South Korea, the development of the chemical industry is accompanied by a rise in the global share of the downstream manufacturing industry. After all, domestic products are more likely to enter the supply system of the domestic manufacturing industry. China's manufacturing industry in the downstream of China’s chemical industry is also on the rise. For example, Greemei in the field of home appliances, Sanyizhonglian in engineering machinery, ZTE Huawei in the communications field, and Lenovo’s millet for electronic products, and quickly go out of the country along with the “One Belt and One Road” strategy. High-speed rail, nuclear power and infrastructure. In addition, in the next 10 years, domestic automobiles, large aircrafts, chips, and OLED panels will also be expected to break through, with the emergence of international brands.

In the future, with these domestically-manufactured manufacturing brands in the global market, China's chemical industry will also expand its overseas market share in a complementary manner. Combining the space of domestic and foreign markets, China may achieve the largest production volume in human history in any single chemical product, and the cost advantage brought by the scale effect will be even more obvious.

Infrastructure facilities have obvious advantages

Since 2009, massive funds have also been invested in infrastructure construction and the most efficient transportation network in the world has been built. At present, the total length of highways in China is 131,000 kilometers, ranking first in the world. The total mileage of high-speed rail is 22,000 kilometers, which is more than the sum of other countries in the world. The top six of the world's highest bridges are all in China, and the number of bridges across the river has exceeded 100; In the world's top ten ports, China has occupied 7 seats. The largest annual throughput of Shanghai Port has exceeded 40 million TEUs, accounting for 10% of the world's total, and is also the sum of the throughput of all US ports.

After 2011, China was still at the peak of infrastructure construction. More than 60% of high-speed rails were opened in the past five years. In the same period, the United States was constrained by insufficient government spending and infrastructure was aging. China's advantage over the United States is still growing. Moreover, the United States is already the most advanced industrial country in the world. If compared with other developing countries, our country is not only a transportation infrastructure, but it is an all-round leader in the supply of electricity and water, political stability, and social security.

The future of China Chemical Industry

In the past two years, we have discovered many interesting phenomena in the study of overseas chemical industries: After 2011, with the outbreak of the shale gas revolution, the price of ethane in North America fell below 1,000 yuan/ton, which is the price of naphtha in China at the same time. 1/7, with a gross margin of more than 50%, but the new capacity is very limited, and so far it has not reached a smooth production; another year this year refrigerant prices rose, R32 from 20,000 yuan / ton up to 100,000 yuan / Tons, Arkema, Europe’s largest company, opted to suspend production in the face of such huge profits, perfectly missing the current surge.

Looking to the future, European and Japanese chemical production capacity is at the highest level of the global cost curve. The development of new and downstream areas such as electric vehicles and smart phones is lagging behind that of China. The high-end fine chemical fields that are good at it are also sitting on the skies and the technology is constantly being broken through by China. The future will continue to shrink.

In contrast, China is still in the midst of a raging industrialization history. In 2010, China’s industrial output value surpassed that of the United States and ranked first in the world. By the end of 15 years, it had reached 67% of the sum of Western countries such as the United States, Europe and Japan. If the difference between the two growth rates can be maintained at 6% in the future, then in 2025 China will comprehensively surpass the total industrial output value of all developed countries. The chemical industry as a supporting material industry for the industry, its global share should also match the overall industrial output value, reaching more than 50%.

The future development direction of China Chemical Industry

Many of China's basic bulk commodities, such as triacids and alkalis, account for more than 50% of the world's total, and the growth space is relatively limited. In the future, the development direction of the upstream industry will undoubtedly seek opportunities in products that are still heavily imported. Among them, the equivalent imports of ethylene and PX exceeded 16 million tons and 12 million tons, respectively, in 16 years, and the amount was more than 100 billion yuan. It will be filled by the new refining and ethane cracking in the future.

In addition to the upstream refining and refining, the future development direction is undoubtedly the industry's shortcomings and new energy sources and new materials that China has not yet conquered.

Judging from historical experience, each breakthrough of one downstream application will bring a new round of development opportunities to chemical companies in the upstream industry chain. With the rise of BOE, the display panel industry, Kangdexin and other electronic chemical companies have achieved rapid growth.

In the future, as China vigorously promotes the localization of the chips, the industries such as photoresist, electronic specialty gases, packaging materials, and high-purity reagents will undoubtedly usher in great development. In addition, the development of lightweight vehicles and large aircraft in China also provides a huge market space for high-end engineering plastics such as carbon fiber and polycarbonate.