Polypropylene pellets flooded the beach to further worsen the survival of powder companies

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Polypropylene powder production enterprises are faced with multiple factors such as the continued rise of the main raw material propylene in the upstream and polypropylene pellets squeezing into the market, etc., and they are entering the period of survival of the inferior and the inferior. The days of polypropylene powder enterprises are generally not good enough.

Polypropylene resin divided into polypropylene pellets and polypropylene powder two products, pellets are usually produced by Sinopec, PetroChina, powder manufacturers are mostly local oil refining companies and outsourced propylene raw material processing enterprises.

“Polypropylene powder enterprises are generally small in scale, with 77% of the company's annual production capacity ranging from 20,000 to 50,000 tons. Propylene is the main raw material for outsourcing. However, due to high propylene prices, powder production companies have stopped production and reduced production. At present, the operating rate is less than 60%,” said Shao Mingjie, the head of the polypropylene division of Anhui Tianda Plastic Composite Products Co., Ltd., told reporters.

“Our polypropylene powder plant has been discontinued for more than six months, and selling powder is not as good as selling propylene directly,” said Gu Kai, business manager of Shantou Tokyo Bo Petrochemical Co., Ltd.

This situation is no longer a case. According to Pan Jifeng, a Polypropylene market analyst from Zhuo Chuang Information Technology, there are 85 polypropylene powder manufacturers in China, with a total designed annual production capacity of 3.865 million tons. The actual output last year was about 1.125 million tons, and the operating rate was only 64.7%. Since last year, the production of propylene using polypropylene has been cost-inverted, which has led some of the refining companies to start direct sales of propylene, and some polypropylene refining equipment manufacturers have ceased production for a long time.

“Under normal circumstances, when the price difference between propylene and polypropylene powder is more than 800 yuan per ton, the production of polypropylene powder will be profitable. But now the market price of propylene has reached 10,100 yuan per ton, compared with the price of polypropylene powder. To be 100 yuan higher, completely upside down, there is no profit at all." Mai Xianghong, deputy sales manager of Ningbo Haiyue New Materials Co., Ltd. said.

In addition to the high cost, polypropylene pellets have taken off in large numbers, further exacerbating the viability of powder companies.

“Powder material is a little worse than physical properties of pellets in terms of physical properties, mechanical properties and weatherability. Under normal circumstances, the impact of pellets on powder materials is not significant.” Li Xiaozhou, manager of olefins department of Guangzhou Baota Petrochemical Co., Ltd., said: “When the market When prices are close, some customers will choose pellets."

“Polypropylene pellets are generally produced by Sinopec and CNPC, and have the cost advantage of propylene. The powder companies that need to purchase propylene are obviously not their competitors.” Jiangsu Betas Chemical Industry Co., Ltd., which manufactures polypropylene powder Cai Aili, the general manager, told reporters with a look of sadness: “In addition, a large number of coal-made polypropylene pellets are now entering the market. The price and powder are close to each other, and the powder companies have been very difficult to do.”

"There are six or seventy varieties of polypropylene produced from coal. The quality is the same as that of the oil route, and the sulfur content is lower and the price is lower. This will accelerate the phase-out of powder companies." Shenhua Ning Coal and Chemical Industry Group Li Hui, the sales company manager, thinks this way. According to him, currently the production capacity of coal-based propylene has accounted for 8% of the total domestic propylene production capacity, of which 69% of coal-based propylene is used to produce polypropylene pellets. With the increase of coal-produced propylene and polypropylene production, the domestic polypropylene market pattern is bound to change. During the “Twelfth Five-Year Plan” period, there are still many installations of polypropylene in China, and the average annual growth rate of production capacity is 16.2%, which is the line of petroleum or coal chemical industry. The space for polypropylene powder enterprises will be further compressed.

Shao Mingjie, head of Polypropylene Business Department of Anhui Tianda Plastic Composite Products Co., Ltd. believes that polypropylene powder has disadvantages such as unit consumption of propylene, high energy consumption, and large fluctuations in product quality. It is only through the use of advanced technological transformation and scientific management methods. Reduce energy consumption, stabilize production, improve product quality, and continue to develop.

He suggested that polypropylene powder enterprises can adopt management methods that combine management, on-site training, and ideological education to give full play to the enthusiasm of operators and effectively guarantee the quality of each product produced. At the same time, energy-saving, energy-saving and potential-removal of the device will be implemented to improve product competitiveness.

Despite the worrying prospects of survival, a person in charge of the Purchasing Department of Haier Group stated: “Pellet is not a complete substitute for powder. Polypropylene powder is brittle and easy to age, but it is easier to mix and use, and its processing performance is also good. Therefore, the advantages and disadvantages of polypropylene powders should be viewed in a dialectical way, avoiding shortcomings in the use of polypropylene powders. If polypropylene powder companies do more work on the modification, they still have a promising future."

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