The hottest global epoxy industry maintains growth

Global epoxy industry maintains growth, investment is active, technological progress

Global epoxy industry maintains growth, investment is active, technological progress

June 22, 2006

in recent years, the growth rate of global epoxy resin is expected to be 4 ~ 6% - of course, this is largely due to the demand of the Chinese market, and the global market will be supported by the strong growth of Chinese demand. However, the demand of the United States still has considerable growth, Europe has stabilized (the growth rate in the next few years is expected to be 3z%), and Japan's demand for epoxy resin has also remained at a certain level. According to experts from China epoxy resin industry association, the main feature of the global epoxy resin industry is that the application fields of epoxy resin such as electronics and coatings are transferred to Asia, especially China. The electronic industry in Asia and the construction field in China have led the growth of the world epoxy resin industry

the supply of bisphenol A in Asia in 2005 was better than that in 2004, but the supply of epichlorohydrin was tight. The high price level of raw materials and the extremely volatile changes around it will make it difficult for demand growth. Some suppliers are seeking potential new markets, such as the epoxy resin system for blades required in offshore wind power generation projects. While the Asian market has benefited from high-speed economic growth, the situation of central and Eastern European markets is similar (the development of construction industry in Eastern Europe, strong demand in Turkey, and many new application fields such as reinforced epoxy resin are used in oil production pipelines (in Russia, it is a growth field)), but to a lesser extent. In addition, composite materials have developed rapidly, accounting for almost 1/3 of the epoxy resin application market. They have replaced traditional materials such as steel, wood and concrete in existing and new application fields, and also promoted the progress of the global epoxy resin industry to a considerable extent. Asia's electronic industry and China's construction sector have led the growth of the world's epoxy resin industry. As an application field of epoxy resin, the marine coating market has been transferred to Asia with the shipbuilding industry. The electronic and electrical appliance market has also moved eastward, and paint and coating manufacturers such as AkzoNobel are also seeking to expand to Asia. There is a shortage of liquid epoxy resin in the world, especially in Asia. Some smaller factories in Asia are facing closure due to the huge cost pressure caused by the rising price of upstream raw materials. Asian epoxy manufacturers, except Chinese enterprises, are unable to export resins to the United States and Europe

since 2004, although the epoxy resin industry has been significantly impacted by the rising cost of raw materials and energy, the profit has still increased. At first, manufacturers were in a state of sluggish response to the rise in raw material prices, but then they were also taking advantage of the continuous rising cost pressure, stable demand and tight supply to continuously raise prices. Faced with market pressure, manufacturers realize that the cost of raw materials must be converted immediately, and the protection price will no longer exist. Resolution perforce chemicals (RPP) changed the price of epoxy resin products from quarterly price to monthly price, and cancelled most of the preferential prices of epoxy resin since October 1, 2004, and also increased some of the prices. Huntsman advanced materials (hereinafter referred to as Huntsman) said that the tight global supply of epoxy resin forced it to implement "strict order control" on bisphenol A epoxy resin in the United States, announcing that the price of liquid and solid epoxy resin would be increased by 22.0 ~ 33.1 cents/kg in December 2004, and then adjusted the price for many times. Dow has raised the prices of liquid and solid epoxy resins and curing agents for many times since October 1, 2004, and said that its transportation capacity was close, and the supply of epoxy resins was tight until the middle of 2005. Dow Chemical and Nava chemical decided to increase the price of epoxy resin by 230 euros/ton in November 2004, which was a response to the heavy impact of raw material prices in October. The quotation of liquid epoxy resin was 1900 ~ 300 euros/ton at that time. Then in January, 2005, the price of liquid and solid epoxy resin was further increased (35.3 ~ 44.1 cents/kg), while the price of epoxy curing agent increased by 33.1 cents/kg. On May 15, 2005, both Dow and RPP announced that they would raise the price of epoxy resin by 15.4 ~ 22.0 cents/kg. Since then, major international companies have also continuously introduced product price adjustment policies with the increase of international oil prices. According to the analysis of experts from China epoxy resin industry association, the epoxy resin Market in many regions experienced a speculative peak in demand in 2005, but despite this (coupled with the short-term further rise in prices and the decline in Asian demand and prices), the European market remained stable on the whole. Compared with the high price in the U.S. market, the price of European products is lower, which protects the European market's exports to Asia. Many experts said that from June to July 2005, as in the previous two months, the market fluctuated. The market price of standard liquid resin is 2300 ~ 2400 euros/ton, and the seller will provide a stable price until the end of August. However, some buyers said that the value of epoxy resin purchased since April has gradually lost, including the fall in the price of 50 euros per ton in July. Buyers hope that the price can be reduced in July. Despite the sharp rise in benzene prices, the price level of epoxy resin in July will be coordinated with the reduction of 50 euros per ton of bisphenol A in June, and the factors affecting the price change of bisphenol A in July will be balanced

there have been great changes in mergers and investment construction of European and American companies in the past year. After the merger of RPP and resolution special materials company (RSM) and Borden chemical company, the world's largest thermosetting resin company was born: Hexion special chemicals company, which was translated as Hansen by experts of China epoxy resin industry association. RPP is a company renamed after Apollo management acquired shell's epoxy resin business in 2000. It is the world's major manufacturer and distributor of epoxy resin. RSM is its new sister company, engaged in coatings, adhesives, special polymers and inks business of Eastman chemicals company [6]. Borden chemicals also signed a final agreement to purchase bakelite from R ü gers (the parent company of bake1ite, a German phenolic and epoxy resin manufacturer). The price of this transaction has not been disclosed, but German domestic media reports estimate that the price of bakelite is 250 ~ 300 million euros, or the transaction price is close to 8 times the advance profit of interest, tax, depreciation and amortization. Bakelite had sales of 540million euros in 2003 and now employs 1700 people. Bakelite has production plants in four places in Germany, wholly-owned production plants in Finland, Italy, Spain, the Czech Republic, South Korea and the United States, and joint ventures in the United States and Japan [6]. This acquisition will increase Borden's annual sales of $1.4 billion by $600million. Bakelite's business is mainly non North American business, which can be used as a supplement to Borden's business (mainly North American business). In addition, RPP filed a lawsuit with the Harris County District Court in Texas in 2004, suing Formosa Plastics Company in Taiwan, China (a manufacturer of epoxy resin and key raw material epichlorohydrin in Taiwan) and some individuals, claiming that its illegal acts include unfair competition, theft of trade secrets, fraud, etc., and demanding compensation for losses of at least US $100million. The Asia Pacific region is an important growth market for Dow Chemical and its epoxy resin business. In Asia, Dow sees greater demand for products using epoxy resins, and is actively studying and evaluating investment and development opportunities in the region. In order to further expand its epoxy resin business in Asia, Dow Chemical acquired the remaining 20% shares of Pacific epoxy's plant in Kumi from South Korea's Saehan Industrial Company. Now it is its wholly-owned holder (80% shares of the plant were purchased in January 2001). The plant has an annual output of 30000 tons of epoxy resin and supplies brominated epoxy, solid and solid solution epoxy resin for protective coatings, electronic products and special products. Huntsman is investing in the construction of a high-performance multi-functional epoxy resin plant in Switzerland. The planned capacity of the plant has not been disclosed, but its completion will double the global supply of multi-functional epoxy resin. The specific investment amount of the project has not been announced, but it is revealed that its scale is millions of dollars. In January, 2005, the construction of the plant began and made rapid progress. The first phase of the project was completed in the fourth quarter of 2005. It is expected to be completed in the middle of 2006. Huntsman invested and built the plant to supplement and balance its supply of multifunctional epoxy resin in North America (McIntosh plant in Alabama, USA) by setting up supply points in Europe, so that its supply capacity is unmatched, and the delivery time to users will be reduced from 18 weeks to 8 weeks. Elementis (British specialty chemicals company) agreed to sell Hardman, its company engaged in epoxy and polyurethane products, to Royal adhesives and sealants (hereinafter referred to as Royal) in the United States for about £ 7.8 million in cash. Hardman's net assets were £ 2.4 million, and in 2004, it made an advance profit of £ 1.1 million in interest, tax, depreciation and amortization (sales of £ 14million). The acquisition of Hardman will enable royal to expand its product field and expand its market. Royal plans to increase its current market share of adhesives and sealants for small vessels and speedboats and is interested in entering the aviation market. The Czech spolchemie company and the Japanese DIC company jointly built an epoxy resin plant in the Czech Republic, with an investment of 2.5 million euros. Using the latest Japanese technology, they produce 30000 tons of solid and liquid resins and 10000 tons of solutions and mixtures every year. While supplying its customers in eastern and central Europe, the factory will be able to vigorously promote its business in Western Europe and explore the markets of Ukraine, Russia, Turkey and North Africa in the future. Its raw material bisphenol a1/3 needs to be purchased, and epichlorohydrin can be 80% self-sufficient

Nippon PELNOX of Japan will enter the market of liquid epoxy resin used in electronic components and similar insulation applications in China and South Asia. The company has used its factories in Thailand to produce such liquid epoxy resin for automotive electronic components and materials, in order to keep up with the growth of the demand for materials in the automotive manufacturing industry in Thailand. Its subsidiary in Taiwan also began to partially produce this kind of resin. In addition, the company signed an agency agreement with a professional Taiwan trading company, and began to sell these products directly from Japan or Taiwan, China, with the goal of South China, especially Dongguan. The company produces and supplies liquid epoxy resin for automotive electronic components in Thailand and epoxy resin for various electronic components in China. At the same time, they plan to conduct a feasibility study, that is, to produce and manufacture this kind of resin in China

Sumitomo bakelite in Tokyo strengthened its established position in the field of thermosetting molding materials by purchasing vyncolit NV and vyncolit North America (Connecticut, USA) from Perstorp group in Sweden. Durez company (Texas, USA), owned by Sumitomo bakelite, produces phenolic, epoxy, polyimide and other resins and compounds. Vyncolit obtained the thermosetting molding business from R ü gers in 2002, producing a series of thermosetting resins and compounds including phenolic, melamine, epoxy, urea formaldehyde, etc. In 2004, Japan produced 2151930 tons of epoxy resin, an increase of 10.2% over 1952850 tons in 2003, and sold 233678 tons of epoxy resin, an increase of 11.4% over 2003 (20976200 tons). In 2004, the demand for epoxy resin in Japan was 143680 tons, an increase of 6% over the previous year, including 58200 tons in the coating field, an increase of 3%; The demand in the field of electronic and electrical appliances was 576700 tons, with a year-on-year increase of 12%, of which the resin for circuit board increased by 14%; The demand for civil construction, adhesives and other uses was 35190 tons, an increase of 3%. Exports were 317500 tons, an increase of 23% over the previous year, totaling 1754300 tons. Epoxy resin demand in Japan in 2004