Polyolefin production from coal/methanol is booming, driving up demand for alpha-olefins

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The growth of polyolefin production from coal/methanol is driving an increase in demand for alpha-olefins. Author/Source: Yaja Consulting, Yaja Coal Chemicals. Date: 2017-10-27. Clicks: 23. The copolymers primarily used in the production of linear low-density polyethylene (LLDPE) and high-density polyethylene (HDPE) are 1-butene, 1-hexene, and 1-octene. Typically, when α-olefins (1-butene, 1-hexene, 1-octene) are used as comonomers in the production of LLDPE, their average content is around 8%-10%, while when used as comonomers for HDPE, their average content is 1%-2%. By the end of 2016, China’s LLDPE and HDPE production capacities were approximately 7.7 million tons per year and 7.65 million tons per year, respectively, while the actual production volumes for that year were 6.52 million tons per year and 5.65 million tons per year, respectively. Calculated at addition levels of 8% and 1% respectively, the consumption of α-olefins by LLDPE and HDPE is 520,000 tons per year and 56,500 tons per year, respectively. The rapid development of China’s coal-based polyethylene industry will drive rapid growth in the demand for alpha-olefins. According to statistics from Yaha Consulting, as of the third quarter of 2017, China had a total polyethylene production capacity associated with CTO/MTO plants of 2.79 million tons per year. Currently, 38 CTO/MTO projects are still in the stages of testing, construction, preliminary work, or planning. It is expected that by 2021, these projects will generate a production capacity of 25 million tons per year for olefins produced from coal/methanol, as well as 8.39 million tons per year of polyethylene. From 2017 to 2021, the average annual growth rate of China’s coal (methanol)-based polyethylene production capacity will be 25%. http://img.yf116.cn/image/img/20171027/1654446088432.jpg Yahuah Consulting estimates that, driven by the development of China’s coal-based polyethylene industry, by the end of 2021, China’s production capacity for LLDPE and HDPE will reach 11 million tons per year and 12 million tons per year respectively, with actual production amountsing to 9.3 million tons and 8.9 million tons respectively in that year. The consumption of α-olefins by these two types of polyethylene will be 750,000 tons per year and 89,000 tons per year respectively, resulting in an overall consumption of 849,000 tons per year – a 45% increase compared to the end of 2016. http://img.yf116.cn/image/img/20171027/1655376093755.jpg