By 2024, ethylene can achieve a production target of over 50 million tons
2023/8/31
The Ministry of Industry and Information Technology, the National Development and Reform Commission, the Ministry of Finance, the Ministry of Ecology and Environment, the Ministry of Commerce, the Ministry of Emergency Management, and the All China Federation of Supply and Marketing Cooperatives recently jointly issued the "Work Plan for Stable Growth in the Petrochemical and Chemical Industry" (hereinafter referred to as the "Plan").
The petrochemical and chemical industry is a fundamental and pillar industry of the national economy, with a large economic aggregate and high industrial correlation, which is related to stable industrial growth and economic operation. In order to implement the decisions and deployments of the Central Economic Work Conference, promote the comprehensive implementation and effectiveness of the State Council's package of policies and follow-up measures to stabilize the economy, promote the stable operation of the industry, and accelerate high-quality development, this "Plan" is specially formulated with an implementation period of 2023-2024. It mainly includes four aspects: overall requirements, main objectives, work measures, and guarantee measures.
Among them, we see that the main goal is to maintain stable growth in the industry, with an average annual growth rate of industrial added value of about 5%. In 2024, the main business revenue of the petrochemical and chemical industry (excluding oil and gas extraction) will reach 15 trillion yuan, ethylene production will exceed 50 million tons, and fertilizer production (converted into net amount) will remain stable at around 55 million tons. It is mentioned that the annual ethylene production target by 2024 is to exceed 50 million tons. So can this goal be achieved?
In terms of ethylene production capacity (excluding the equivalent production capacity of ethylene containing gas and C2 components produced by some units), as of the end of 2022, China's ethylene production capacity has exceeded 48.5 million tons/year. By the end of August 2023, the ethylene production capacity will be approximately 52 million tons, and there will be a new MTO plant added in Baofeng Phase III during the year. According to public information, it is planned to put in nearly 4 million tons of new ethylene production capacity in 2024, and the production time of some units is still uncertain. Conservatively, it is estimated that the production capacity in 2024 will be close to 57 million tons.
In terms of ethylene production, according to Jin Lianchuang's estimation, the domestic ethylene production in 2022 is about 41.2 million tons, with a capacity utilization rate of about 85%, which is less than 9 million tons below the target. As of the end of July 2023, the estimated ethylene production is about 26.17 million tons, a year-on-year increase of about 12%, and the capacity utilization rate is about 81%. Therefore, it is estimated that the annual production in 2023 may exceed 46 million tons, which is 4 million tons lower than the target.
Due to the low utilization rate of ethylene comprehensive production capacity since 2022, it is mainly due to the sustained high prices of ethylene production raw materials such as crude oil, naphtha, light hydrocarbons, methanol, and weak demand for ethylene derivatives and terminal products. Ethylene costs are high, prices are dragged by demand, and the upward trend is weak. It is necessary to reduce the burden to reduce the risk of losses. At present, the commencement of various ethylene process units has been improved. In addition, the "Plan" includes measures to expand effective investment, promote high-end, green, and intelligent development, promote major project construction, and increase technological transformation efforts, which are beneficial to the ethylene industry. With the commissioning of large-scale integrated projects such as Tianjin Nangang, Yulong Petrochemical, and Jilin Petrochemical in 2024, theoretically speaking, By 2024, ethylene can achieve the goal of producing over 50 million tons.
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