How is the domestic and foreign market status of non-ionic cellulose ether?

(1) Overview of the global nonionic cellulose ether market:

From the perspective of global production capacity distribution, 43% of the total global cellulose ether production in 2018 came from Asia (China accounted for 79% of Asian production), Western Europe accounted for 36%, and North America accounted for 8%. From the perspective of global cellulose ether demand, the global cellulose ether consumption in 2018 is about 1.1 million tons. From 2018 to 2023, the consumption of cellulose ether will grow at an average annual rate of 2.9%.

Nearly half of the total global cellulose ether consumption is ionic cellulose (represented by CMC), which is mainly used in detergents, oilfield additives and food additives; about one-third is non-ionic methyl cellulose and its derivatives substances (represented by HPMC), and the remaining one-sixth is hydroxyethyl cellulose and its derivatives and other cellulose ethers. The growth in demand for non-ionic cellulose ethers is mainly driven by applications in the fields of building materials, coatings, food, medicine, and daily chemicals. From the perspective of the regional distribution of the consumer market, the Asian market is the fastest growing market. From 2014 to 2019, the compound annual growth rate of demand for cellulose ether in Asia reached 8.24%. Among them, the main demand in Asia comes from China, accounting for 23% of the overall global demand.

(2) Overview of the domestic non-ionic cellulose ether market:

In China, ionic cellulose ethers represented by CMC developed earlier, forming a relatively mature production process and a large production capacity. According to IHS data, Chinese manufacturers have occupied nearly half of the global production capacity of basic CMC products. The development of non-ionic cellulose ether started relatively late in my country, but the development speed is fast.

According to the data of China Cellulose Industry Association, the production capacity, output and sales of non-ionic cellulose ethers of domestic enterprises in China from 2019 to 2021 are as follows:

After years of development, China’s non-ionic cellulose ether market has made great progress. In 2021, the designed production capacity of building material-grade HPMC will reach 117,600 tons, the output will be 104,300 tons, and the sales volume will be 97,500 tons. Large industrial scale and localization advantages have basically realized domestic substitution. However, for HEC products, due to the late start of R&D and production in my country, the complex production process and relatively high technical barriers, the current production capacity, production and sales volume of HEC domestic products are relatively small. However, in recent years, as domestic enterprises continue to increase investment in research and development, improve the level of technology and actively develop downstream customers, production and sales have grown rapidly. According to the data from the China Cellulose Industry Association, in 2021, major domestic enterprises HEC (included in industry association statistics, all-purpose) have a designed production capacity of 19,000 tons, an output of 17,300 tons, and a sales volume of 16,800 tons. Among them, production capacity increased by 72.73% year-on-year compared with 2020, output increased by 43.41% year-on-year, and sales volume increased by 40.60% year-on-year.

As an additive, the sales volume of HEC is highly affected by the downstream market demand. As the most important application field of HEC, the coatings industry has a strong positive correlation with the HEC industry in terms of output and market distribution. From the perspective of market distribution, the coatings industry market is mainly distributed in Jiangsu, Zhejiang and Shanghai in East China, Guangdong in South China, the southeast coast, and Sichuan in Southwest China. Among them, the coating output in Jiangsu, Zhejiang, Shanghai and Fujian accounted for about 32%, and that in South China and Guangdong accounted for about 20%. 5 above. The market for HEC products is also mainly concentrated in Jiangsu, Zhejiang, Shanghai, Guangdong and Fujian. HEC is currently mainly used in architectural coatings, but it is suitable for all kinds of water-based coatings in terms of its product attributes.

In 2021, the total annual output of China’s coatings is expected to be about 25.82 million tons, and the output of architectural coatings and industrial coatings will be 7.51 million tons and 18.31 million tons respectively6. Water-based coatings currently account for about 90% of architectural coatings, and about accounting for 25%, it is estimated that my country’s water-based paint production in 2021 will be about 11.3365 million tons. Theoretically, the amount of HEC added to water-based paints is 0.1% to 0.5%, calculated on an average of 0.3%, assuming that all water-based paints use HEC as an additive, the national demand for paint-grade HEC is about 34,000 tons. Based on the total global coating production of 97.6 million tons in 2020 (of which architectural coatings account for 58.20% and industrial coatings account for 41.80%), the global demand for coating grade HEC is estimated to be about 184,000 tons.

To sum up, at present, the market share of coating grade HEC of domestic manufacturers in China is still low, and the domestic market share is mainly occupied by international manufacturers represented by Ashland of the United States, and there is a large space for domestic substitution. With the improvement of domestic HEC product quality and the expansion of production capacity, it will further compete with international manufacturers in the downstream field represented by coatings. Domestic substitution and international market competition will become the main development trend of this industry in a certain period of time in the future.

MHEC is mainly used in the field of building materials. It is often used in cement mortar to improve its water retention, prolong the setting time of cement mortar, reduce its flexural strength and compressive strength, and increase its bonding tensile strength. Because of the gel point of this type of product, it is less used in the field of coatings, and mainly competes with HPMC in the field of building materials. MHEC has a gel point, but it is higher than HPMC, and as the content of hydroxy ethoxy increases, its gel point moves to the direction of high temperature. If it is used in mixed mortar, it is beneficial to delay cement slurry at high temperature Bulk electrochemical reaction, increase the water retention rate and tensile bond strength of the slurry and other effects.

The investment scale of the construction industry, the real estate construction area, completed area, house decoration area, old house renovation area and their changes are the main factors affecting the demand for MHEC in the domestic market. Since 2021, due to the impact of the new crown pneumonia epidemic, real estate policy regulation, and liquidity risks of real estate companies, the prosperity of China’s real estate industry has declined, but the real estate industry is still an important industry for China’s economic development. Under the overall principles of “suppression”, “restraining irrational demand”, “stabilizing land prices, stabilizing house prices, and stabilizing expectations”, it emphasizes focusing on adjusting the medium- and long-term supply structure, while maintaining the continuity, stability, and consistency of regulatory policies, and improving the long-term real estate market. Effective management mechanism to ensure the long-term, stable and healthy development of the real estate market. In the future, the development of the real estate industry will tend to be more high-quality development with higher quality and lower speed. Therefore, the current decline in the prosperity of the real estate industry is caused by the phased adjustment of the industry in the process of entering a healthy development process, and the real estate industry still has room for development in the future. At the same time, according to the “14th Five-Year Plan for National Economic and Social Development and 2035 Long-term Goal Outline”, it is proposed to change the mode of urban development, including accelerating urban renewal, transforming and upgrading old communities, old factories, old The functions of stock areas such as old blocks and urban villages, and promote the renovation of old buildings and other goals. The increase in the demand for building materials in the renovation of old houses is also an important direction for the expansion of the MHEC market space in the future.

According to the statistics of the China Cellulose Industry Association, from 2019 to 2021, the output of MHEC by domestic enterprises was 34,652 tons, 34,150 tons and 20,194 tons respectively, and the sales volume was 32,531 tons, 33,570 tons and 20,411 tons respectively, showing an overall downward trend. The main reason is that MHEC and HPMC have similar functions, and are mainly used for construction materials such as mortar. However, the cost and selling price of MHEC are higher than that of HPMC. In the context of the continuous growth of domestic HPMC production capacity, the market demand for MHEC has declined. In 2019 By 2021, the comparison between MHEC and HPMC output, sales volume, average price, etc. is as follows: