Homogenization serious high-end dependence on imported synthetic rubber structural contradictions prominent

- May 23, 2019-

In recent years, China's synthetic rubber production capacity growth slowed down, but the product homogenization phenomenon is still serious, many high-end products are still heavily dependent on imports.Facing the severe situation, industry experts suggest that the pressure of the synthetic rubber industry should be in the rational planning of new device construction, actively promote product structure adjustment, strengthen the application of development and other aspects.


The phenomenon of homogenization is serious

Before 2003, synthetic rubber products were always materials with tight supply and demand and good economic benefits. The relevant departments of the state encouraged domestic enterprises to vigorously develop the synthetic rubber industry through a variety of ways. Since then, the production capacity has seen a blowout growth.

According to statistics, during the 12th five-year plan period, China's synthetic rubber production capacity increased from 2.825 million tons/year in 2010 to 5.956 million tons/year at the end of 2015, with an average annual growth rate of 16.1%.

Although the synthetic rubber production capacity growth has slowed down in recent years, but the product homogenization phenomenon is still serious, leading to the increase of disorderly competition between enterprises.


High-end products are imported

The rapid growth in production capacity has made China the largest producer of synthetic rubber, with an annual output of 5.787 million tons in 2017 and 5.59 million tons in 2018.

Relevant data show that in 2018, China's synthetic rubber imports totaled 4.4118 million tons, up 1.1 percent year-on-year, maintaining a four-consecutive increase.In 2018, China's synthetic rubber exports totaled 303,400 tons, up 16.04 percent year-on-year.Exports were $716 million, up 18.15 percent year-on-year.

It is worth noting that due to the influence of the development of downstream rubber products industry, China's synthetic rubber products' external dependence has rapidly recovered in recent years, and the proportion of imports in demand has climbed from 22.4% in 2014 to 45.5% in 2018.

Overall, China's synthetic rubber industry oversupply and a large number of structural contradictions between imports more prominent.


Efforts will be made in four areas for development

In order to promote the healthy development of the industry, the insiders gave four Suggestions.

First, rational planning for the construction of new installations.In recent years, a large number of new installations have been built and put into production in China, resulting in overcapacity in some varieties. Therefore, the proposed and under construction production installations need to conduct feasibility studies again according to the market rules and the capacity of the recent market, so as to carry out the construction of new installations in a reasonable and orderly way.

Second, advance traditional technology.Most of China's synthetic rubber devices adopt traditional technology, and there is a significant gap between China and the international advanced level in energy conservation and environmental protection.

Third, actively promote product restructuring.Enterprises need to rely on controllable free radical polymerization, controlled anion polymerization and other basic research results to develop new synthetic rubber products with new structure and performance.

Fourth, strengthen application development.All the eight basic rubber varieties of synthetic rubber in China have been localized. However, such as brominated butyl rubber, rare earth butadiene rubber and polyisoprene rubber, etc., although the device has been put into production, the downstream development is not strong enough, resulting in low operating rate of the device.Industry enterprises need to actively promote the application and research of these gels with downstream users, otherwise it will affect the healthy development of these products.