We believe that the investment strategy of the chemical industry is to invest in systematic innovation and low-cost expansion. The next 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 have conquered cities and occupied land 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, the carbon emissions of China Petroleum & Chemical Corporation(600028) and basic chemical industry rank first among all industries, accounting for about 18% of the total national carbon emissions, 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 go through three stages in the context of carbon neutrality in the next 40 years:
The first stage is to reach 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 high energy consuming products or industries do not mean that there is no development, but will give priority to reaching the peak, and low energy consuming products or industries are expected to obtain a longer growth window;
In the second stage, the future competition will be downstream and overseas. With the carbon peak, the upstream bulk raw materials of 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 has increased significantly. The huge cash flow obtained by large chemical enterprises may be invested in the field of downstream fine chemicals and new materials, or continue 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 disruptive impact locally. Bio based materials are a possible alternative / supplement. With the decline of the cost of bio based materials, the rise 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 recycling technology, etc.), the three stages we understand may also be staggered.
According to the government work report in 2022, the energy consumption target is balanced and flexible, and the development of renewable energy ushers in the spring
At 9 a.m. on March 5, the fifth session of the 13th National People’s Congress held its opening meeting in the Great Hall of the people. Premier Li Keqiang delivered a government work report.
The report proposes that the target of energy consumption intensity in 2022 will be comprehensively assessed during the 14th Five Year Plan period, with appropriate flexibility, and the new renewable energy and raw material energy will not be included in the total energy consumption control. Orderly promote carbon peak and carbon neutralization. Implement the carbon peak action plan. Promote the energy revolution, ensure energy supply, based on resource endowments, adhere to the first establishment and then destruction, and make overall plans to promote the low-carbon transformation of energy. Strengthen the clean and efficient utilization of coal, orderly reduction and substitution, and promote the transformation of energy conservation and carbon reduction, flexibility and heating of coal and electricity. Promote the planning and construction of large-scale wind and solar power bases and their supporting regulatory power sources, and improve the consumption capacity of the power grid for renewable energy power generation. Promote the R & D, promotion and application of green and low-carbon technologies, build a green manufacturing and service system, and promote energy conservation and carbon reduction in iron and steel, nonferrous metals, petrochemical, chemical, building materials and other industries. We will resolutely curb the blind development of projects with high energy consumption, high emissions and low levels. Promote the transformation from “dual control” of energy consumption to “dual control” of total carbon emission and intensity, improve the incentive and restraint policies for reducing pollution and carbon, and accelerate the formation of a green production and lifestyle; Focusing on the major national strategic deployment and the 14th five year plan, we will moderately advance infrastructure investment. We will build key water conservancy projects, comprehensive three-dimensional transportation networks, important energy bases and facilities, accelerate the renewal and transformation of urban gas pipelines and other pipe networks, improve flood control and drainage facilities, and continue to promote the construction of underground comprehensive pipe corridors. We will deepen the reform of the investment examination and approval system, ensure the use of land, energy and other elements, and separate energy consumption for major national projects.
Deployment of carbon peak carbon neutralization leading group in 2022
The first plenary meeting of the leading group for carbon neutralization in 2022 was held in Beijing on March 1, which is the first meeting of the leading group for carbon neutralization in 2022.
\u3000\u30001. Dual carbon positioning and implementation principles. Realizing carbon peak and carbon neutralization is a major strategic decision made by the CPC Central Committee with Comrade Xi Jinping as the core to coordinate the two overall situations of China and the world.
We should make overall plans for development and security, adhere to seeking progress while maintaining stability, first stand and then break, make overall plans, scientifically grasp the pace of work, and ensure energy security, industrial chain supply chain security and food security while reducing carbon, so as to ensure the normal life of the people.
We should fully understand the supporting and leading role of “double carbon” in high-quality development, maintain our strategic focus, focus on key areas and key links, solidly promote the “double carbon” work, and walk out of an ecological priority, green and low-carbon development path in line with national conditions.
We should pay close attention to deepening the research on major issues of “double carbon” and form operable policies and measures.
We should promote the orderly substitution and transformation of coal, clarify the “big account” of coal supply and demand, reasonably plan the scale and layout of coal power construction, promote the clean and efficient utilization of coal, and give full play to the basic and bottom-up guarantee role of coal in energy.
\u3000\u30002. Major deployment and mechanism establishment. We should study and promote the development of renewable energy, accelerate the planning and construction of a new energy supply and consumption system, and support the development of distributed new energy.
We should study and build a market-oriented mechanism to promote “double carbon”, improve the electricity price formation mechanism and improve the carbon emission trading market.
We should strengthen basic capacity-building, establish a unified and standardized statistical accounting system for carbon emissions, promote the transformation from “dual control” of energy consumption to “dual control” of total carbon emissions and intensity, and pay close attention to tackling key problems and promoting the application of green and low-carbon technologies.
Industry maintenance:
[petrochemical sector]
Pure benzene: the production capacity under maintenance this week was 693400 tons, 135000 tons less than last week.
Toluene: the production capacity under maintenance this week was 671000 tons, 719100 tons less than last week.
Propylene: the production capacity under maintenance this week was 7.21 million tons, an increase of 100000 tons over last week.
Butadiene: the total capacity under maintenance this week was 490000 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 is 480000 tons, an increase of 480000 tons over last week.
PX: the production capacity under maintenance this week was 3.645 million tons, 4.97 million tons less than last week.
PTA: the production capacity under maintenance this week is 20.47 million tons, 4.3 million tons less than last week.
Acrylic acid: the production capacity under maintenance this week was 240000 tons, the same as last week.
Butyl acrylate: it is under maintenance this week, with a total capacity of 400000 tons, the same as last week.
Propylene oxide: the production capacity under maintenance this week was 1.51 million tons, the same as last week.
[coal chemical sector]
Ethylene glycol: the production capacity under maintenance this week was 10.278 million tons, an increase of 1.19 million tons over last week.
Acetic acid: the production capacity under maintenance this week was 6.31 million tons, 500000 tons less than last week.
Acetic anhydride: the production capacity under maintenance this week was 310000 tons, the same as last week.
Adipic acid: the production capacity under maintenance this week was 915000 tons, the same as last week.
DMF: the production capacity under maintenance this week is 70000 tons, the same as last week.
[polyurethane sector]
MDI: the production capacity under maintenance this week was 1.67 million tons, the same as last week.
TDI: the total production capacity under maintenance this week was 2.237 million tons, the same as last week.
[chemical fiber sector]
Polyester chip: the production capacity under maintenance this week is 100000 tons, 450000 tons less than last week.
Polyester bottle chip: the production capacity under maintenance this week was 3.55 million tons, the same as last week.
Polyester staple fiber: the production capacity under maintenance this week was 2.17 million tons, 780000 tons less than last week.
Polyester filament: the production capacity under maintenance this week was 138182 million tons, 375000 tons less than last week.
Nylon slicing: there are 2 companies in maintenance this week, the same as last week.
[pesticide and fertilizer sector]
Synthetic ammonia: 67 companies were under maintenance this week, 2 more than last week.
Multi dimensional tracking of key companies
\u3000\u30 Shanxi Huhua Group Co.Ltd(003002) 85
Company information:
According to the State Patent Office, Shandong Sinocera Functional Material Co.Ltd(300285) 0 new patents were published this week.
Price information:
The average price of titanium dioxide (rutile, China) this week was 19700 yuan / ton, up 0.20% month on month, with a historical quantile of 72%; The price difference of rutile titanium dioxide this week was 17770 yuan / ton, with a month on month increase of 0.23% and a historical quantile of 84%.
\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 309
Industry information:
According to Baichuan Yingfu, the situation of MDI device has not changed this week and continues the situation of last week: Wanhua baoside, which is in shutdown due to force majeure, has resumed the operation of its 350000 T / a MDI device. In addition, the 400000 T / a MDI unit of Ningbo Wanhua phase I started shutdown and maintenance on November 27, and gradually recovered in the near future; Phase II 800000 T / a equipment will be shut down for maintenance on December 11, and the maintenance is expected to take 45 days.
MDI: the production capacity under maintenance this week was 1.67 million tons, the same as last week. According to Baichuan Yingfu, all manufacturers have no new maintenance plan this week.
According to the State Patent Office, Wanhua Chemical Group Co.Ltd(600309) this week, 0 new patents were published.
Price information:
The average price of polymerized MDI (East China) this week was 19543 yuan / ton, down 9.31% month on month, with a historical quantile of 33%; The average price of pure MDI (East China) this week was 24821 yuan / ton, up 10.70% month on month, with a historical quantile of 49%; The average price of soft foam polyether (East China) this week was 12314 yuan / ton, up 1.49% month on month, with a historical quantile of 36%; The average price of hard foam polyether (East China) this week was 11314 yuan / ton, with a month on month decrease of 0.02% and a historical quantile of 46%; The average price of propylene oxide (East China) this week was 11850 yuan / ton, with a month on month increase of 3.04% and a historical quantile of 39%; The average price of butyl acrylate (East China) this week was 15180 yuan / ton, down 11.38% month on month, with a historical quantile of 68%; The average price of MTBE (98%, China) this week was 5745 yuan / ton, down 1.63% month on month, with a historical quantile of 40%; The average price of PC (General Motors, China) this week was 22280 yuan / ton, down 0.54% month on month, with a historical quantile of 38%.
The price difference of East China polymerized MDI this week was 14177 yuan / ton, down 13.28% month on month, with a historical quantile of 31%; The price difference of pure MDI in East China this week was 19455 yuan / ton, up 12.99% month on month, with a historical quantile of 48%; The price difference of propylene oxide this week was 3160 yuan / ton, down 3.07% month on month, with a historical quantile of 21%; The price difference of PC this week was 7061 yuan / ton, with a month on month increase of 30.35% and a historical quantile of 33%; The price difference of hard foam polyether this week was 1834 yuan / ton, with a month on month decrease of 13.34% and a historical quantile of 51%.
Overseas competition
BASF
March 2nd – BASF and foam expert NEVEON are working together to further develop the old mattress recycling, aiming to build a closed loop mattress product. At present, the main treatment methods of waste mattresses are incineration and landfill. BASF and NEVEON want to change the status quo and let the mattress foam return to the closed loop. The two sides plan to start early this year to test the use of recycled mattresses in batch production of regenerated mattress foam, and expand the scale of production in the next few years.
[kostron]
February 28 – in view of the successful business development, the board of directors of kostron decided today to implement the stock repurchase plan. The total amount of the plan is about 500 million euros (excluding ancillary transaction costs) and will be completed within two years. Generally, the repurchased shares will then be cancelled and the share capital will be reduced accordingly.
March 1 – kostron achieved success in fiscal year 2021. The group benefited from strong global demand and strong profitability throughout the year. Core sales increased by 10% year-on-year, mainly due to the increase in sales of resin and functional materials (RFM) business acquired from DSM. In particular, higher selling prices due to strong demand meant that the group’s sales increased by 48.5% to € 15.9 billion (last year: € 10.7 billion) – the highest level in Kosh’s history.
March 1 – costron focused its corporate vision on achieving a complete cycle. To this end, the material manufacturer hopes to fully align its entire production and product range, as well as all areas in the long term, with the concept of recycling. One specific measure on this road is climate neutrality. Compared with 2005, kostron reduced greenhouse gas emissions by 54% as early as 2021, thus exceeding the previously set sustainable development goal of 2025.
March 3 – kostron recently launched two polycarbonate composite production lines at its grand Noida plant near New Delhi, India. The new plant aims to meet the growing demand for composite plastics, especially in the automotive, electrical and electronic industries. In total, more than 25 new jobs were created.
March 4 – kostron responded to humanitarian emergencies in Ukraine and neighbouring countries through a targeted aid package. The group, headquartered in Leverkusen, donated 250000 euros to the German partner organization of the United Nations High Commissioner for Refugees (UNHCR). UNHCR has been active in Ukraine since 1994 and has set up offices and warehouses throughout the country to distribute humanitarian assistance. In neighbouring countries, UNHCR supported the preparation and ongoing operations of relevant authorities and local aid organizations to enable rapid assistance to refugees.
[ExxonMobil]
March 1 – ExxonMobil plans to produce hydrogen, carbon capture and storage at the Baytown complex. Irving, Texas – ExxonMobil said today that it is planning to build a hydrogen production plant and one of the world’s largest carbon capture and storage projects at its integrated refining and petrochemical base in bedon, Texas, to support efforts to reduce corporate operations and local industrial emissions.
March 1 – ExxonMobil will stop in SA
