2021-2022 China PX Industry Pattern
PX is an important key hub connecting oil refining and chemical industry. It is not only one of the most important products in aromatics, but also the leading raw material of polyester industry. At present, the largest downstream is PTA, accounting for 99%, and only a small part is used in pharmaceutical intermediate dimethyl terephthalate (DMT), coatings and other fields. In the early stage, the PX market developed slowly limited by factors such as project investment, raw material guarantee and pollution treatment, which formed an obvious mismatch between supply and demand with the blowout expansion of downstream PTA industry driven by the development of polyester industry. However, in the past two years, China's PX industry developed rapidly with the increased of refining and chemical integration projects, and the import dependence degree narrowed to 37.50%.
In terms of supply, China's PX market was in supply crunch from 2017 to 2021. The slow growth of supply and the deepening of the imbalance between supply and demand were mainly due to the restriction of project access threshold and the pressure of construction return cycle in the first two years. Since 2019, large-scale integrated refining and chemical projects successively stepped onto the stage. China's PX entered the stage of centralized production of new production capacity, and the self-sufficiency rate was effectively improved, which had a strong impact on imported resources. In 2021, the effective output of PX in China is expected to reach 22.27 million mt, a year-on-year increase of 13.45%. In 2022, China's PX will continue the rapid development process. At the same time, "industrial cluster, large-scale plant and refining and chemical integration" will become the main tone of market development.
In terms of demand, the downstream application of PX is single, and the proportion of PTA in China's PX consumption field has remained at and above 98% in recent five years. With the elimination of China's PTA backward production capacity, the PTA industry entered the second round of expansion of new production capacity since 2020, thus driving the effective release of new PX capacity. In 2021, the total demand for PX in China is expected to be 34.93 million mt, with a year-on-year increase of 5.56%. In 2022, PTA industry will continue to develop both upward and downward. With the injection of new forces, China's demand for PX will achieve blowout growth.
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