Propylene: An Initial Exploration of the Development Trends in the Methanol-to-Olefins Industry
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This post was last edited by liaifeng on 2018-9-10 at 19:32. Acrylic Acid: An Initial Overview of the Development Trends in the Methanol-to-Olefins Industry. Author/Source: Date: 2017-03-07. Views: 28. Olefins (ethylene, acrylic acid) are important chemical raw materials. China’s demand for olefins is increasing year by year, with the equivalent gap continuing to widen. The market gap is mainly covered by large-scale imports from abroad. With the growth of China’s coal chemical industry in recent years, a new olefin production process – methanol-to-olefins (MTO) – has been introduced, providing more options for China’s olefin supply. Currently, the main routes for olefin supply in China include naphtha steam cracking, propane dehydrogenation, coal-to-olefins, and methanol-to-olefins using externally purchased methanol. Since 2011, methanol-to-olefins plants have been continuously planned and put into operation in our country. As of December 2016, 18 methanol-to-olefins plants had been built and put into operation in China, with a total production capacity of 9.33 million tons per year. Figure: Comparison of propylene and international oil price trends from 2012 to 2016. Olefin prices are closely linked to international crude oil prices. After June 2014, international crude oil prices plummeted, and olefin prices followed this trend by dropping as well. From a full cost perspective, methanol-to-olefins has no advantage over other process routes; the profit margin from ethylene production is minimal, while propylene production even results in losses. Since the sharp drop in oil prices, some facilities in our country have ceased operations, while most of those scheduled to come online are still in operation. Looking solely at manufacturing costs, in 2016 China’s average import price for methanol was 238 dollars per ton, while the price of ethylene was 1,056 dollars per ton and that of propylene was 753 dollars per ton. Approximately 3 tons of raw material methanol are required to produce 1 ton of olefins, and there is still a profit margin after deducting labor costs. At present, there is sufficient market demand for olefin products in our country; as long as there is a profit margin in the methanol-to-olefins process, companies will continue to use this method to produce olefins. During periods of high oil prices, affected by crude oil costs, the price advantage of the naphtha cracking route gradually diminishes. When international crude oil prices exceed $80 per barrel, methanol-to-olefins becomes cheaper than naphtha cracking, and the profit margin expands as crude oil prices rise. As a non-renewable resource in the world, it is only a matter of time before oil prices rise again. Data shows that international crude oil prices are set to return to the $80 per barrel level in 2020. By then, methanol-based olefin production will be more competitive in the market than naphtha-based olefin production. The current international crude oil price is around $53 per barrel, remaining in a period of low-level fluctuations. Oil prices are expected to return to around $80 per barrel in 2020, but until then they will remain low for some time. Therefore, during the short period when international oil prices remain low, methanol-based olefin production in China does not have a significant cost advantage over traditional naphtha-based olefin production, and the economic benefits are limited. Plants that have not yet been put into operation will slow down their commissioning process, while those that are already in operation will seek to reduce olefin production costs through measures such as energy savings and reduced consumption. Once international crude oil prices recover to above $80 per barrel in the future, methanol-to-olefins production in our country will enjoy a significant cost advantage, posing a strong challenge to the traditional naphtha-to-olefins approach. In the long term, methanol-to-olefins may become the main trend in the development of China’s olefins market in the future.
In the past, olefins produced through oil-based routes were the main product, so the market price of olefins depended on the price of crude oil, which in turn was determined by market demand. Previously, market demand for crude oil was influenced by the supply and demand balance of crude oil itself; however, with the emergence of alternative resources such as coal-based chemicals and shale oil, market demand for crude oil now depends on the balance among these three factors. After the significant fluctuations that occurred between 2014 and 2016, the market realized that irrational fluctuations in oil prices cause great harm to all parties involved, with only a few speculators reaping profits. Therefore, the future trend should be a relatively stable upward trajectory, along with a gradual transition and substitution by coal chemical industry and shale oil, ultimately leading to balanced development of all three.
A large number of projects for coal-based olefins have already been approved; at that time, a price of 80 yuan per barrel will not be sufficient to cover the costs. As production volumes increase, prices will drop, so it’s still too early to be optimistic
Will rising crude oil prices not eventually drive up the prices of coal and natural gas? Won’t these things ultimately affect methanol prices? During a certain period, coal chemical products served as a supplement to petrochemical products, with triene triphenyl being the most abundant of these petrochemical products. Naturally, this is also the best path for coal chemistry, as coal-based olefins are the most mature form of such products. It is inevitable that the number of projects will continue to increase. But it’s too difficult to make money by buying methanol to produce olefins. Coal chemical industry is essentially about profit transfer, with only a slight increase in profits. They made a profit from others on the raw materials, then made another profit from methanol, and now they want to make money from olefins as well. Is this too naive? This article’s analysis is really not good.
I agree with your view. It is not wise to be overly optimistic about the prospects of coal-based olefins, unless overall process optimization for this technology leads to significant reductions in energy consumption, water usage, and even costs. .