Main points:
We believe that the investment strategy of the chemical industry is to invest in systematic innovation and low-cost expansion. The next wave of industrial pattern of chemical industry depends on talent competition. The chemical industry has changed from a simple capital intensive industry to a talent and capital intensive industry. The latecomers can’t surpass the capital and can only stare at the latecomers. Therefore, the periodicity of the chemical industry becomes weaker. With effective incentives, excellent management and continuous innovation, excellent companies have created unshakable advantages in technology iteration, low cost and efficient service, and conquered cities and territories in the global market.
Carbon neutralization may bring disruptive changes and opportunities to the chemical industry
Carbon neutralization has a far-reaching impact on the chemical industry. According to npcpi statistics, China Petroleum & Chemical Corporation(600028) and basic chemical industry lead all industries in carbon emission, accounting for about 18% of the total national carbon emission, of which “process carbon emission” accounts for about 6% and “engineering carbon emission” accounts for about 12%, which is greatly affected by the 3060 carbon neutralization target. From the perspective of industry evolution, we believe that the chemical industry is expected to experience three stages in the context of carbon neutrality in the next 40 years:
The first stage reaches the peak step by step. There are many chemical products. The energy consumption and carbon emission of each product are different, and its carbon peak requirements may be different. We understand that for high energy consuming products or industries, it does not mean that there is no development, but the peak will be reached first, and low energy consuming products or industries are expected to obtain a longer growth window;
The second stage of future competition is downstream and overseas. With the carbon peak, the upstream bulk raw materials in China’s chemical industry hit the ceiling due to relatively high energy consumption, but without a large amount of new production capacity, the profit center increased significantly. The huge cash flow obtained by large chemical enterprises either invested in the downstream fine chemicals and new materials, or continued to expand the production capacity of similar products, Just transfer the new capacity to countries or regions with greater carbon capacity. In the second stage, chemical enterprises may face large-scale technological transformation of public works, and use green energy alternatives to reduce energy consumption, so as to reduce the tax costs related to carbon neutralization;
The third stage is the era of bio based materials and energy. Chemical products are closely related to people’s lives, and the demand will not disappear because of policies. However, under the goal of carbon neutralization, fossil based materials may face subversive impact locally. Bio based materials are a possible alternative / supplement. With the decrease of the cost of bio based materials, the increase of the cost of fossil based materials (the increase of carbon emission taxes) and the breakthrough of bio based materials of “non grain” raw materials, bio based materials are expected to become a new bottom material for global industry.
It is worth emphasizing that the above is the idea of industry evolution for 40 years. 3060 mainly affects the ceiling of long-term high energy consuming products or industrial development, and has little impact on the approved planning projects. In addition, a series of operable policies will evolve under the 3060 goal. With the implementation of specific policies and the breakthrough of new technologies (including synthetic biology, new energy storage technology, new nuclear power technology, new recovery technology, etc.), the three stages we understand may also be staggered.
The Ministry of industry and information technology issued the 2021 carbon peak carbon neutralization special industry standard preparation and revision project plan, covering petrochemical, chemical, iron and steel, nonferrous metals, building materials, rare earth, light industry, textile, electronics, communications and other industries. On December 22, the Ministry of industry and information technology issued the 2021 carbon peak carbon neutralization special industry standard preparation and revision project plan. This is the first time that the Ministry of industry and information technology has publicly issued the annual carbon peak carbon neutralization special industry standard preparation and revision project plan. In this plan, standards are prepared and revised for 9 major industries such as petrochemical and chemical industry, iron and steel, nonferrous metals, building materials, rare earth, light industry, textile, electronics and communication. A total of 110 standards are planned to be prepared and revised, of which 2 are revised, the rest are formulated, and the revised 2 are nonferrous industries. The top four industries with the most revisions are building materials, iron and steel, petrochemical industry and nonferrous metals, with 28, 23, 21 and 14 respectively. Among them, there are 45 Samsung projects, and there are no Samsung projects in rare earth, light industry, textile, electronics and communication industries. Industry maintenance:
[petrochemical sector]
Pure benzene: the production capacity under maintenance this week was 1.8684 million tons, 60000 tons less than last week.
Toluene: the production capacity under maintenance this week was 1576100 tons, an increase of 30000 tons over last week.
Propylene: the production capacity under maintenance this week was 5.13 million tons, an increase of 300000 tons over last week.
Butadiene: the total capacity under maintenance this week was 592000 tons, the same as last week.
Isobutylene: there is no production capacity under maintenance this week, which is the same as last week.
Bisphenol A: the production capacity under maintenance this week was 300000 tons, the same as last week.
PX: the production capacity under maintenance this week was 8.415 million tons, the same as last week.
PTA: the production capacity under maintenance this week was 22.57 million tons, an increase of 1.1 million tons over last week.
Acrylic acid: the production capacity under maintenance this week was 1.07 million tons, a decrease of 35000 tons over last week.
Butyl acrylate: it is under maintenance this week, with a total capacity of 1.14 million tons, 80000 tons less than last week.
Propylene oxide: the production capacity under maintenance this week was 1.51 million tons, the same as last week. [coalification plate]
Ethylene glycol: the production capacity under maintenance this week was 5.39 million tons, 400000 tons less than last week.
Acetic acid: the production capacity under maintenance this week was 6.71 million tons, the same as last week.
Acetic anhydride: the total capacity under maintenance this week was 310000 tons, an increase of 160000 tons over last week.
Adipic acid: the total capacity under maintenance this week was 915000 tons, the same as last week.
DMF: the production capacity under maintenance this week is 70000 tons, 50000 tons less than last week.
[polyurethane plate]
MDI: the production capacity under maintenance this week was 1.87 million tons, an increase of 850000 tons over last week.
TDI: the total production capacity under maintenance this week was 2.237 million tons, an increase of 67000 tons over last week.
[chemical fiber plate]
Polyester chip: the production capacity under maintenance this week was 300000 tons, the same as last week.
Polyester bottle chips: the production capacity under maintenance this week was 3.35 million tons, the same as last week.
Polyester staple fiber: the production capacity under maintenance this week was 1.87 million tons, the same as last week.
Polyester filament: the production capacity under maintenance this week was 12.6882 million tons, the same as last week.
Nylon slicing: a total of one company was under maintenance this week, the same as last week. [pesticide and fertilizer sector]
Synthetic ammonia: a total of 61 companies were under maintenance this week, an increase of 3 over last week.
Risk statement
Policy disturbance; Technology diffusion; New technology breakthrough; Global intellectual property disputes; Global trade disputes; The tightening of carbon emission brings the risk of catching up with production capacity; Risk of sharp decline in oil prices; The risk of a sharp economic downturn.
