Seeking the latest information on dimethyl carbonate technology and market developments: An overview of the industry development of dimethyl carbonate

Struggling under dual pressures: The dimethyl carbonate industry needs new approaches (Authors: Wang Jing, Li Yongsheng; Source: Sinochem New Network) In recent years, China’s dimethyl carbonate industry has been in a downturn, and the poor performance of this industry is an undeniable fact. Although the potential market is huge and the prospects are promising, there is severe overcapacity; many production facilities are shut down, and the operations of related companies are also facing difficulties. Of course, there are also some companies that are exploring various opportunities and actively transforming in order to get out of this situation. What experience do they have that could serve as a model? To this end, a team of five members—including Zhang Yong, deputy editor-in-chief of China Chemical Industry News; Wang Jing, director of the Industry Research and Development Center at China Chemical Industry News and secretary-general of the National Carbonate Industry Alliance; Su Jianze, director of the Video Center at China Chemical Industry News; Di Zongxian, office director; and Li Yongsheng, editor at Sinochem New Network—traveled over 2,000 kilometers from June to September to visit and conduct research on companies involved in dimethyl carbonate production in Shandong. High raw material costs are keeping corporate profit margins under pressure. Most of the dimethyl carbonate production facilities in use in China employ the transesterification process, for which one of the key raw materials is propylene oxide. At present, most propylene oxide in China is produced using the chlorohydrin method. This method consumes a large amount of water, generating significant amounts of wastewater and waste residues. As a result of environmental regulations, many small enterprises using this method have been shut down. The new hydrogen peroxide direct oxidation method (HPPO method) features a simple process, high yield, and is environmentally friendly; however, the core manufacturing technology is held by foreign companies, which makes the cost of implementing this method quite high. For example, Shandong Yangmei Hengtong Chemical Co., Ltd. had already planned to develop a propylene oxide project and possesses an advantage in terms of the upstream raw material, hydrogen peroxide; however, due to technical constraints, the project is still under consideration at present. The research team had discussions with the leadership of Shandong Shanyang Meihengtong Chemical Co., Ltd. For these reasons, propylene oxide is currently in a seller’s market, which directly drives up its price. According to Zhang Xinping, general manager of Shandong Depu Chemical Technology Co., Ltd., the profit margin on propylene oxide is currently between 2,000 and 3,000 yuan per ton. The high cost of raw materials not only erodes the profit margins of downstream dimethyl carbonate products and reduces their market competitiveness; more importantly, aside from a few companies that possess their own propylene oxide production facilities, most companies in the carbonate industry are dependent on external suppliers for their raw materials, which **reduces the stability of product prices. Zhang Junkai, general manager of Shandong Lixing Chemical Co., Ltd., is deeply aware of this issue. As the company does not have its own propylene oxide production facilities, it pays close attention to the developments in the region’s epoxy production facilities, hoping to have a sufficient and stable supply source. The research team visited Shandong Lixing Chemical Co., Ltd. and Shandong Depu Chemical Technology Co., Ltd. At present, the construction of new chlorohydrin-based production facilities has been prohibited; the co-oxidation and direct oxidation methods face cost and technical challenges. As a result, the issue of obtaining propylene oxide as a raw material for dimethyl carbonate will remain a persistent problem for companies that produce dimethyl carbonate. The production process faces challenges, and new technologies need to be developed. At present, the domestic production facilities for dimethyl carbonate primarily use the traditional transesterification method, with propylene oxide, carbon dioxide, and methanol as the main raw materials. The transesterification process is relatively mature, but it is significantly affected by the price control of the upstream raw material, propylene oxide. In addition, there is also the issue of dealing with the by-product propylene glycol. It is reported that for every ton of dimethyl carbonate produced, 0.8 tons of 1,2-propanediol are generated as a by-product. Currently, the national production of 1,2-propanediol exceeds 500,000 tons, far surpassing the domestic market capacity of 250,000 tons. Over the years, the market for propylene glycol has experienced significant fluctuations due to competition from imported propylene glycol and mixed diols produced through the hydrolysis of polyols in the domestic market. As the production capacity of the transesterification method continues to increase, the output of the by-product propylene glycol will also exceed demand. The excess propylene glycol is difficult to sell due to limitations in market capacity, which not only affects the operating rate of the plants but also impacts the economic viability of the dimethyl carbonate production facilities. 　　To address this situation, companies in the industry and research institutions have, through scientific and technological efforts, developed the urea hydrolysis process as well as the two-step urea process. However, compared with the transesterification process, the plants that use these new processes currently face certain challenges. According to Zheng Peng, general manager of Shandong Feiyang Chemical Co., Ltd., the urea hydrolysis process route: Shandong Feiyang Chemical built a plant with a capacity of 10,000 tons in 2012, and successfully implemented this process while establishing a complete production chain. However, for various reasons, this set of equipment is currently shut down, and the company is under great pressure. The research team had discussions with Zheng Peng, the general manager of Shandong Feiyang Chemical Co., Ltd. The process technology for synthesizing dimethyl carbonate via the two-step urea method was developed through a collaboration between East China University of Science and Technology and Jiangsu Jinmei Hengsheng Chemical Co., Ltd. According to Professor Fang Yunjin from East China University of Science and Technology, the two-step urea method for synthesizing DMC uses urea and propylene glycol, which is a by-product of the traditional transesterification process for DMC production, as raw materials. First, the intermediate propylene carbonate is synthesized; this compound then undergoes an ester exchange reaction with methanol to produce dimethyl carbonate. The propylene glycol produced as a by-product is reused together with urea to further synthesize propylene carbonate. 　　It is reported that Yangmei Group Qingdao Hengyuan Chemical Co., Ltd. has built a plant for the two-step production of dimethyl carbonate from urea, with an annual capacity of 40,000 tons; the project has now been completed. How the test drive goes will be a focus of attention in the industry. Liu Zhichen, the chief engineer of Shandong Alliance Chemical Group Co., Ltd., said that they have been keeping an eye on the developments at Qingdao Hengyuan’s production facility. This manufacturing process uses urea and methanol as raw materials, and adopting this process will give them a significant cost advantage. If they can get a set of mature production facilities up and running, they plan to enter this field. The research team held discussions with the leaders of Shandong Alliance Chemical Group Co., Ltd. The growth of traditional application markets is weak, and the industry needs to explore new areas for development. Traditionally, the main applications of dimethyl carbonate have been in coatings and adhesives. However, as the production capacity and output of dimethyl carbonate increase, and considering that it can be replaced by other solvents, it has become essential for companies to accelerate the development and utilization of its downstream markets in order to find new sources of profit growth. 　　Dimethyl carbonate, as an additive for gasoline and diesel, once gave enterprises hope. 　　 　　Research has shown that dimethyl carbonate is highly suitable for catalytic gasoline and reformed gasoline with an octane number of over 80. Due to the high oxygen content of dimethyl carbonate, at the same oxygen level as gasoline, only 40% of the volume of MTBE is required to achieve a blending effect similar to that of MTBE, while harmful exhaust emissions are reduced by more than 50%. Adding oxygen-containing additives to diesel can effectively improve the performance and emissions of diesel engines, with a particularly significant effect on reducing soot or particles. Experiments have shown that the appropriate addition of dimethyl carbonate can be used to produce smokeless diesel, effectively reducing or eliminating particulate emissions from exhaust gases. 　　However, for various reasons, dimethyl carbonate is prohibited from being used as an additive in gasoline and diesel, which deprives companies of a huge market. Wu Xiangzhou, vice president of Shandong Depu Technology Group, believes that dimethyl carbonate has certain advantages over MTBE, and he hopes that policies will be introduced as soon as possible to allow its use as an additive in gasoline and diesel. 　　Polycarbonate (PC) is in short supply in the market at present, but the driving effect of demand for dimethyl carbonate has not been significant yet. China has a high demand for polycarbonate; in 2016, China’s consumption of polycarbonate was approximately 1.7 million tons. The net import volume is nearly 1.1 million tons, resulting in a low self-sufficiency rate. To increase self-sufficiency, domestic companies are accelerating research and development efforts, launching and expanding PC production projects, which will lead to a significant increase in China’s polycarbonate production capacity. According to incomplete statistics, after 2016, more than 1 million tons per year of PC production capacity is set to be built, with projects either in the planning stage or under consideration. In this regard, Jia Fenglei, General Manager of the Fine Chemicals Division at Shandong SDCSH Chemical Group Co., Ltd., believes that there are too many polycarbonate production projects underway in China at present; the polycarbonate market is set to turn into a competitive ‘red ocean’ in the future. This serves as a warning to companies in the industry, and it is hoped that it will draw their attention. 　　Although the development of polycarbonate can boost market demand for dimethyl carbonate, given the current state of PC production technologies that do not rely on phosgene in China as well as the projects currently under implementation, the demand for dimethyl carbonate in PC applications is not very high; this makes it difficult to alleviate the current surplus supply of dimethyl carbonate. The research team had discussions with the leaders of Shandong Lihua Yi Group. Shandong Lihua Yi Group is currently building a PC production facility with an annual capacity of 130,000 tons; it is expected to come online by June next year. The company is on the path to transformation and upgrading. Shandong Sinopec Shenghua Chemical Group Co., Ltd. (hereinafter referred to as Sinopec Shenghua), as a leading manufacturer of dimethyl carbonate in China, has set a benchmark for the development direction of this industry amid challenging market conditions. As early as 2005, the company was the first to introduce carbonate products into the solvent market, and in 2007 it expanded into the polycarbonate sector as well. Currently, in the market for battery electrolyte solvents, efforts to enter this field began as early as 2003. The research team visited Shandong Sinopec Shenghua Chemical Group Co., Ltd. In recent years, in addition to continuing to perform well in the traditional field of coating solvents, Sinopec Shenghua has also made efforts to expand into high-end market applications. Thanks to its early establishment in this field, its carbonate products hold a significant advantage in the area of battery electrolyte solvents. It has not only become a supplier to many well-known electrolyte manufacturers in China but has also managed to enter the international market. In 2014, its share of the global market for battery electrolyte solvents was around 40%, making it the undisputed leader in this industry. 　　While making full use of its own research institutions for scientific research and technological innovation, Shida Shenghua also strengthens horizontal collaborations with research institutes to complement each other’s strengths. The rapid transformation of scientific and technological achievements enhances a company’s vitality, enabling it to stand out in fierce market competition, establish itself in the market with a unique style, and gain a lasting competitive advantage. The research team took a group photo with the leaders of Shandong Sinopec Shenghua Chemical Group Co., Ltd. Haike Xinyuan Chemical Co., Ltd., also located in Dongying City (hereinafter referred to as Haike Xinyuan), has also embarked on a path of development driven by technology and innovation. Wang Chunmei, general manager of Haike Xinyuan, said that this year, the world’s largest electrolyte solvent production project was launched at Haike Xinyuan. The plan to produce 100,000 tons of electrolyte solvent products per year was announced on May 8th at a press conference in Dongying. Excellent quality and mutual success in the future constitute a solemn commitment for the people at Haike Xinyuan. At present, the carbonate products of Haike Xinyuan are rarely used in ordinary industrial applications; most of them have been directed toward high-end electronic-grade applications. It offers a full range of five products for use as solvents in battery electrolytes. Wang Chunmei (first from the right), General Manager of Dongying Haike Xinyuan Chemical Co., Ltd., had a discussion with the research team. As a green and environmentally friendly chemical intermediate, dimethyl carbonate boasts a huge potential market and promising prospects, yet the industry is currently facing significant challenges. To overcome difficulties, the key lies in transforming potential market demand into actual demand, and in improving efficiency and reducing costs through continuous efforts to strengthen internal capabilities.

Jinlian Chuang: Dimethyl carbonate – New electrolyte solvent production facilities in operation; Haike maintains control over prices. Author/Source: Date: 2017-05-12. Clicks: 150. Jinlian Chuang News (Market Analyst: Xu Yao): Introduction: Amidst the continuous decline in the price of dimethyl carbonate, Dongying Haike has experienced a slower rate of price drop, with its price reductions remaining below those of the market. It continues to negotiate at relatively high prices and thus retains control over pricing, avoiding participation in price wars. As shown in the figure above, since May, the ex-plant prices of dimethyl carbonate produced by Dongying Haike have been higher than the average price of products from factories in Shandong, giving it a competitive advantage in the market. According to rough estimates by Jinchuang, the price quotes from manufacturers of dimethyl ester in Dongying Haike have dropped by about 300 yuan per ton, while the average price drop for factories in Shandong is around 267 yuan per ton – a figure that is about 12.36% higher than that of the Shandong factories. Other manufacturers such as Sinopec Shenghua (27.860, -0.89, -3.10%) and Wells have seen price drops that are lower than the average. Thus, Dongying Haike’s dimethyl carbonate holds a market price advantage. It is understood that this is closely related to the inventory control situation at the factory. On February 26, the R&D Department of Dongying Haikexinyuan Company was established, and in June work began on the electrolyte solvent production facility project; thus, Xinyuan Company moved forward as a provider of innovative technical services for specialty chemicals. And the facility began operating normally at the end of April. As is well known, dimethyl carbonate is an important raw material for electrolyte solvents. Its production process involves passing the raw materials through purification columns, mixing them according to specific ratios, stirring the mixture at low temperatures while adding the salt LiPF6, and then conducting quality checks before filling the product. In brief, the process flow is: raw materials → reaction → filtration → distillation → cooling → purification → filling → finished product. It is evident that with the operation of Dongying Haike’s new electrolyte solvent plant, the factory’s capacity to consume dimethyl carbonate has increased, enabling it to manage its inventory in a rational and effective manner and keep stock levels within acceptable ranges. Amid the weak demand for dimethyl carbonate in the market, sales performance was poor across various manufacturers, with most facing inventory pressures and eager to sell their stock. Dongying Haiko, on the other hand, was able to keep its inventory at a reasonable level due to its improved capacity to handle dimethyl carbonate, so it wasn’t in a rush to sell. As a result, its decline was relatively mild compared to other factories; it avoided following the trend blindly and thus managed to protect its profits effectively.

Projects related to dimethyl carbonate and its downstream industries have been launched in Yueyang. Author/Source: Date: June 9, 2017. Click-through rate: 118. Recently, Taizhou Suyang Gas Development Co., Ltd. signed a cooperation agreement with the Yueyang Green Chemical Industry Park regarding the development of projects related to dimethyl carbonate and its downstream industries. The project is planned to be located in the Changling area of the Yueyang Green Chemical Industry Park. With a total investment of 1.5 billion yuan, the first phase will cover an area of 80 mu and will involve the construction of a facility capable of producing 60,000 tons of dimethyl carbonate along with 48,000 tons of propylene glycol per year. The second phase will see the construction of a facility capable of producing 100,000 tons of polycarbonate per year, thereby filling the strategic gap in this industrial chain in the Central and Southwest regions. The construction of this project will extend the downstream industrial chain of propylene oxide; meanwhile, the propylene glycol produced as a by-product can be used as a raw material for the 100,000-ton per year polyether production facility that is being built through a partnership between Xingchang Co., Ltd. and Takahashi Petrochemical, thereby enabling mutual supply of products and raw materials among the enterprises within the industrial park.

Stuck in a Quagmire: Can Dimethyl Carbonate Find a Way Out? Author/Source: Date: 2015-04-16 Clicks: 141 Introduction: The dimethyl carbonate industry faced severe difficulties in 2014, and its performance remained unsatisfactory in the first quarter of 2015. Since the fourth quarter of 2014, “reaching new lows” seems to have become a common description of the industry’s situation. CashSilverIsland provides a brief analysis and forecast for future trends: As can be seen from the charts above, dimethyl carbonate continued to show a downward trend in the first quarter of 2015. Although there were occasional rebounds, the price generally remained low, with the average selling price in Shandong at 3,700 yuan per ton – the lowest level since 2009. The average price for the first quarter was 4,162 yuan per ton, a significant drop of 29.98% compared to the previous year, and a 22.52% decline compared to the average price for the whole of 2014. After dropping by half in the second half of 2014, international crude oil did not show any significant improvement in 2015, remaining stuck in a range of 45–50 dollars per ton. Meanwhile, the Chinese economy continued to grow slowly within the framework of structural adjustments; many solvent products, including aromatics, remained trapped in a weak, stagnant market situation, and dimethyl carbonate was no exception. Faced with a weak supply and demand situation as well as a complex overall environment, how will dimethyl carbonate perform? Firstly, from the perspective of international crude oil technology in recent times, there has been a clear shift in the mindset of traders, with increasing buy signals emerging. However, as demand remains weak, it is unlikely to see significant improvement. Therefore, it is expected that international crude oil prices will remain at relatively low levels in the coming period, and there is a risk of further declines on a temporary basis. Secondly, the development trends in the real estate sector will directly affect the demand for dimethyl carbonate as a key downstream solvent. At the end of March, multiple departments introduced new policies regarding real estate; these included reducing the down payment required for second-home purchases to 40%, lowering the down payment for first-home purchases using housing provident fund loans to 20%, and reducing the down payment for second-home purchases using such loans to 30% ； Furthermore, individuals are exempt from business tax when selling a home that has been owned for more than two years. Adding to this are the new policies issued by the Ministry of Land and Resources and the Ministry of Housing and Urban-Rural Development, which aim to curb the situation of an oversupply of land in second- and third-tier cities. Some institutions believe that China’s recent easing policies in the real estate sector may boost homebuyers’ expectations of market stabilization. There is also some anticipation regarding the introduction of policies to ease restrictions on loans for second homes. Stabilization or gradual improvement in the real estate market will provide necessary support for the medium-to-long-term trend of dimethyl carbonate prices. Once again, analyzing the trend of the raw material propylene oxide: in early April, as PO prices stagnated and then declined, the dimethyl carbonate industry was given a brief respite from the pressure of high costs. However, both this product and its counterpart, propylene glycol, saw price drops; thus, the industry’s pattern of losses remains difficult to reverse. Supported by the maintenance plans for some cyclopropane plants, prices have stopped falling and are now at a bottom level; in the future, a tentative and limited rebound is possible. In the medium to short term, the negative impacts on the costs of dimethyl carbonate have been alleviated. In addition, Gold and Silver Island has provided the following summary of the operating conditions of some facilities in the dimethyl carbonate industry: Overall, the macroeconomic environment remains unfavorable; there is an oversupply of dimethyl carbonate, so it is unlikely to see significant price increases. However, the second quarter is a period for maintenance activities in this industry, which will help to reduce overall supply pressure to some extent. Moreover, as the weather warms up, demand from some end-users is expected to improve gradually, thanks to macroeconomic policies. At present, the price of mainstream acceptance in Shandong has dropped to a relatively safe level of 4,100–4,200 yuan per ton. Overall, the market for dimethyl carbonate looks promising, with a rebound and increase in prices expected in the second quarter.

It would be great if someone could post a table showing the current sales prices in various locations.