Analysis of the Production & Market of ABS in 2014

By Wang Liheng, You Shanshan, Jilin Design Institute of CNPC Northeast Refining & Chemical Engineering Co., Ltd.

1. Production

In 2014, China had 11 acrylonitrile-butadiene-styrene resin (ABS) producers with a total capacity of 3.578 million t/a, the output was around 2.825 million tons, up 525 kt YoY, and the overall operating rate of the units was 78.95%. Zhenjiang Chi Mei Chemical Co., Ltd. was the largest ABS producer in China with a capacity of 800 kt/a.
China’s capacity to make ABS is mainly distributed in East China, and the capacity to produce ABS in East China accounts for 59.75% of the national total. Major ABS producers in East China are joint venture enterprises like Zhenjiang Chi Mei Chemical Co., Ltd., Ningbo LG Yongxing Chemical Co., Ltd. and Formosa Plastics (Ningbo) Co., Ltd. The capacity to make ABS in Northeast China is 870 kt/a, accounting for 24.32% of the total, and major ABS producers in Northeast China are PetroChina Jilin Petrochemical Co., Ltd., PetroChina Daqing Petrochemical Co., Ltd. and North Huajin Chemical Industries Group Corporation. The ABS enterprise in North China is Tianjin Dagu Chemical Co., Ltd. with a capacity of 400 kt/a. PetroChina Lanzhou Petrochemical Co., Ltd., located in Northwest China, has an ABS capacity of 20 kt/a. The startup of CNOOC & LG Petrochemicals Co., Ltd.’s ABS unit in Huizhou of Guangdong province gave South China ABS capacity for the first time.
From view of the operating status of ABS units, the phenomenon of polarization among enterprises in 2013 still continued in 2014. The large enterprises such as Zhenjiang Chi Mei Chemical Co., Ltd., Ningbo LG Yongxing Chemical Co., Ltd. and Formosa Plastics (Ningbo) Co., Ltd. had a relatively good operating status, and their operating rate maintained at 80%-95%. The combined output of ABS from the three enterprises mentioned above accounted for 62.5% of the national total. The operating rate of ABS unit in PetroChina Jilin Petrochemical Co., Ltd. was 78.1%. The operating rate of ABS units using the continuous bulk polymerization process technology was relatively low, being only 45.7%. Therefore, the dissemination and application of ABS produced using the continuous bulk polymerization process technology needs to be strengthened.
The first phase 150 kt/a ABS project of CNOOC & LG Petrochemicals Co., Ltd. (a joint venture between CNOOC and Korean LG Chemical Ltd.) was put into operation in 2014. The company is actively preparing the second phase project, and after startup of the second phase, the capacity to make ABS in the company will climb to 300 kt/a. Considering the excess saturation of the domestic general-purpose ABS market, the company mainly produces special materials and high-end general-purpose materials (high mobility) to realize product differentiation.

Table 1    China’s major ABS producers in 2014

Producer    Capacity (kt/a)    Output (kt)    Operating rate (%)
Zhenjiang Chi Mei Chemical Co., Ltd.    800    650    81.3
Ningbo LG Yongxing Chemical Co., Ltd.    650    710    109.2
PetroChina Jilin Petrochemical Co., Ltd.    580    453    78.1
Formosa Plastics (Ningbo) Co., Ltd.    450    405    90.0
Tianjin Dagu Chemical Co., Ltd.    400    245    61.3
Sinopec Shanghai Gaoqiao Petrochemical Co., Ltd.    200    107.5    53.8
North Huajin Chemical Industries Group Corporation    190    59.9    31.5
CNOOC & LG Petrochemicals Co., Ltd.     150    85    56.7
PetroChina Daqing Petrochemical Co., Ltd.    100    101.9    101.9
Shanghai Huayi Polymer Co., Ltd.     38    5.5    14.5
PetroChina Lanzhou Petrochemical Co., Ltd.    20    2.2    10.8
Total    3 578    2 825    78.95


Table 2    China’s supply & demand of ABS, 2008-2014

Year    Output (kt)    Import (kt)    Export (kt)    Apparent consumption (kt)    Self-sufficiency rate (%)
2008    1 570    1 952    43    3 479    45.1
2009    1 705.5    2 167    50    3 822.5    45.0
2010    1 968.1    2 169    55    4 082.1    49.0
2011    2 149    1 852.7    43    3 958.7    54.3
2012    2 109    1 665.4    41.6    3 732.8    56.5
2013    2 297.2    1 669.9    31.3    3 935.8    58.4
2014    2 825    1 668.3    33.2    4 460.1    63.3


Table 3    China’s import & export of ABS, 2007-2014

Year    Import volume (kt)    YoY growth (%)    Export volume (kt)    YoY growth (%)
2007    2 170    7.4    32    60.0
2008    1 950    -10.1    43    34.4
2009    2 167    11.1    50    16.3
2010    2 169    0.0    55    10.0
2011    1 852.7    -14.6    43    -21.8
2012    1 665.4    -10.1    41.6    -0.04
2013    1 669.9    0.3    31.3    -24.8
2014    1 668.3    -0.009    33.2    0.06


Table 4   China’s import sources of ABS in 2014

Import source    Import volume (kt)    Proportion (%)
Taiwan province    837.7    50.21
South Korea    573.8    34.39
Malaysia    67.2    4.03
Japan    63.5    3.80
Thailand    60.2    3.61
Others    65.9    3.96
Total     1 668.3    


2. Market

China is the world's largest ABS consumer, and ABS in China is mainly consumed in making automobiles, household electric appliances, etc. China’s total consumption of ABS reached around 4.46 million tons in 2014, up around 500 kt YoY.
The application of ABS in China is highly concentrated in electronic/electric appliance fittings such as refrigerators, televisions, telephones, office equipment and other small household electric appliances, and such consumption of ABS accounts for around 80% of the total. The consumption of ABS in making toys and ITE equipment accounts for around 10% each. In the electronic/electric appliance sector, the demand for ABS in making computers, air conditioners and duplicating machines has grown rapidly in recent years. In the communication and transportation sector, the consumption of ABS in making automobiles and motorcycles will also increase considerably. The high impact ABS with heat resistance for automobile fittings, board grade ABS for refrigerators and flame retardant grade ABS for computers will become new growth points for demand. However, in some application fields, ABS faces new competition from other modified resins or resin blending materials with lower cost.
Among the above mentioned products, different kinds of ABS such as general-purpose injection molding grade ABS, flame retardant grade ABS, extrusion grade ABS, ABS with heat resistance, ABS for pipes, transparent ABS, plating grade ABS and ABS for modification are used for different purposes. The general-purpose injection molding grade ABS is the main ABS product in the domestic market, and its consumption accounts for over 70% of the total.
Despite the rapid growth of ABS capacity and output, China still imports a large amount of ABS products each year. In 2014, China imported 1.668 million tons of ABS, being basically the same as that in 2013. China’s supply and demand of ABS during 2008-2014 are listed in Table 2.
With the drastic growth of domestic ABS capacity and the continuous improvement of the technical level, China’s ABS self-sufficiency will increase constantly in the next few years and is expected to reach 65% in 2015.
In the first ten months of 2014, domestic prices of ABS dropped steadily. After October 2014, due to the sharp drop of crude oil prices in the international market, the production cost of ABS was reduced drastically, and the typical price of ABS decreased sharply to RMB11 600/t by the end of 2014.

3. Import and export

China’s capacity to make ABS has been in surplus, but China still imports a large amount of ABS each year. Since 2011, China’s import volume of ABS has decreased year-by-year. China’s import and export of ABS during 2007-2014 are shown in Table 3.
In 2014, the processing imported materials trade mode was the main import trade mode of ABS, and the amount imported by the processing imported materials trade mode accounted for around 54% of the total and also remained relatively stable. China’s import sources of ABS in 2014 are shown in Table 4.

4. Scientific research and development

Researchers at the Research Institute of PetroChina Daqing Petrochemical Co., Ltd. have found out that bromine/antimony flame retardant has a good flame retardant effect on ABS. The flame retardant with high bromine content has a better flame retardant effect than the flame retardant with low bromine content, and it has only a little influence on the impact strength of the system. Adding the proper amount of magnesium hydroxide in flame retardant ABS system containing bromine/antimony flame retardant can improve the impact strength of the system and has a smoke eliminating effect. The toughening modification of the system by adding chlorinated polyethylene (CPE) can ensure the flame retardant system has good processing performance. The excellent flame retardant resin can be obtained by adding 8%-12% bromine/antimony flame retardant, 0.5%-0.8% magnesium hydroxide as well as 7% CPE into ABS, and the oxygen index of the resin can reach 31.2%.
Researchers at the College of Chemical Engineering of Hebei Shijiazhuang University have researched the effects on the mechanical and flame retardant properties of flame retardant ABS composite by respectively using styrene-butadiene-styrene block copolymer (SBS), poly (octene-ethylene) (POE) and ethylene propylene diene monomer (EPDM) rubber as toughening agents. The results show that comprehensive properties of the composite taking SBS as toughening agent are better than those taking POE or EPDM as toughening agent, and the impact strength of the composite improves with the increase of SBS consumption.

5. Development trend

At present, the international ABS sector is developing toward high-performance special materials and plastic “alloy”. In China, the development of modified polypropylene (PP) and high impact PP has a greater impact on the ABS market. Major ABS producers in China mostly produce general-purpose varieties with low prices and low profit-earning ability. Therefore, improving the product quality and accelerating the development of special materials and blend alloys are the development focus for ABS. The special materials with larger domestic demand include flame retardant ABS, ABS for refrigerator boards, ABS with heat resistance, transparent ABS, high gloss ABS, ABS with static resistance, plating grade ABS as well as ABS alloy resins like polyamide (PA)/ABS, polycarbonate (PC)/ABS, and polyvinyl chloride (PVC)/ABS.