How Does SBS Producer Solidify and Broaden the Development Path

SCI99

2019-05-14

How Does SBS Producer Solidify and Broaden the Development Path under the Background of Waterproofing Industry Expansion

Recently, waterproofing listed enterprises announced the first quarter financial data, and the data at China’s major waterproofing enterprises was good. Beijing Oriental Yuhong Waterproof Technology reported a revenue of 2.686 billion in the first quarter of 2019, and the net profit attributable to shareholders of listed enterprises was 127 million RMB. Enterprises such as Keshun Waterproof Technologies, Jiangsu Canlon Building Materials and China Academy of Building Research have maintained good profitability. In 2018, the growth rate of the entire waterproofing industry was 9%, and the growth rate of waterproof roll industry was 10.5%. The industrial expansion, centralization and standardization caused SBS practitioners to pay full attention and focus. According to SCI’s statistics, in 2018, the actual demand for SBS from the waterproof roll industry was 91kt, hitting a record high. Under such a background, what impact will the future waterproofing industry have on the development of SBS industry and market changes?

The concentration of waterproofing industry is much higher than that of other downstream industries such as the shoe material industry, the modified bitumen industry and the adhesive industry. The demand for SBS from the leading enterprises and large and medium-scale enterprises basically represents the direction of modifiers in the whole industry. In the early days, the waterproof industry was often overlooked. Moreover, SBS plays a role as a modifier in the production of waterproof roll and modified bitumen, and in early stage, the demand for SBS from the waterproofing industry is far lower than that from the modified bitumen industry. Therefore, in terms of the SBS research & development, production and follow-up technology service, the priority is given to the modified bitumen industry. There are very few SBS grades dedicated to the waterproofing industry, and most ones in the market are some general-purpose grades. To meet the requirements of the waterproof material production, take a unique and different routes may become the main adjustment direction of future SBS production plants.

As seen from the expansion scale of the waterproofing industry, the future waterproofing industry will continue to maintain a relatively high growth rate. According to the goal of the 13th Five-Year Plan referring to the waterproof building, it is necessary to cultivate 20 large-scale waterproofing enterprise groups and 100 large-scale production enterprises. The modified bitumen and waterproof roll industries have become the main drivers to stimulate the growth of SBS demand. At present, the shoe material industry is shrinking rapidly; the demand for SBS in shoe making is declining year by year; the newly-added expressway mileage has decreased, and the demand growth has slowed down compared with that during the Twelfth Five-Year Plan. As for the waterproof roll industry, the demand for SBS has maintained double-digit growth. In the future, with the further advancement of the industry standardization and the gradual flow of orders to large and medium-scale enterprises, the demand for SBS will be further stimulated.

In the waterproofing industry, the transportation radius determines the competitiveness of products in the regional market. In theory, the requirement of transportation radius is less than 500 kilometers. Large-scale production enterprises have an advantage in the market competition and are focusing on the national layout. Beijing Oriental Yuhong Waterproof Technology takes the lead in completing the national layout. Keshun Waterproof Technologies, Jiangsu Canlon Building Materials, SKSHU Paint and other enterprises have new production bases put into production in the future. As seen from the supply of SBS to the waterproofing industry in recent years, the supply of traditional SBS capacity may be slightly tight. The enterprises represented by Sinopec Baling Company and Tianjin LG Botian Chemical have already reduced the supply to other fields. The emerging SBS production plants follow up limitedly on the waterproof industry and have not yet had an impact on the superior capacity.

As seen from the overall supply and demand pattern of SBS, it is conservatively estimated that there will be a newly added capacity of 610kt in the next five years. The imbalance between the supply and demand will further intensify. It is urgently to be considered how existing enterprises and the enterprises intend to enter the market to weigh product positioning and how to stand on the market. In summary, the development of waterproofing industry is inseparable from that of the SBS industry. Optimizing the deployment of existing capacity, clarifying product positioning, and increasing the investment in the research & development of waterproof product-used SBS will become the key to SBS enterprises to keep a foothold in the waterproofing industry.

……

More detailed information, please click "Read more".