Brief Analysis On The First Half Year Of China'S Carbon Fiber Market

In the first half of 2022, unexpected factors such as the rebound of the new epidemic situation in China and international geopolitical conflicts have brought impact on China's economic operation, and the development faces continuous risks and challenges. In this context, the crude oil price fluctuates greatly, the downstream demand continues to be depressed, and the overall production and operation situation of the chemical fiber industry is grim. Carbon fiber industry is supported by the steady growth of downstream demand, especially under the goal of "double carbon", the application of carbon fiber in wind power, photovoltaic, hydrogen storage and transportation and other fields continues to expand, and the industry as a whole maintains a good development.

　　 1、 Analysis of acrylonitrile industry

According to relevant data, the domestic acrylonitrile industry has increased production capacity of about 390000 tons. The impact of the epidemic situation on logistics and demand, especially the limited growth of ABS demand for acrylonitrile and the mismatch between supply and demand have led to a sharp drop in product prices. Since January, the average price has been declining month on month, and the market has continued to fluctuate downward. On June 30, the price of acrylonitrile in Shandong market was 10800 yuan / ton, down 2500 yuan / ton or 19% from the end of the previous year. Considering the subsequent domestic supply increment, the price of acrylonitrile is expected to further reduce or stabilize, which is conducive to the reduction of production costs of carbon fiber precursor and carbon fiber enterprises.

　　 2、 Carbon fiber import data

According to customs data, from January to June 2022, China's imports of carbon fiber products totaled 14739 tons, a decrease of 16% compared with the same period in 2021. On the one hand, the demand for carbon fiber by Boeing, Airbus and other major European and American enterprises gradually recovered, and the total export volume to China decreased. On the other hand, it also showed that the supply of domestic carbon fiber increased gradually and the market share gradually increased. From the product category, carbon fiber 5332 tons, a year-on-year increase of 94%; Other carbon fiber products were 7555 tons (most of which were carbon fiber tow), with a year-on-year decrease of 29%; Carbon fiber prepreg was 1369 tons, up 67% year on year; Carbon fiber fabric 483 tons, a year-on-year decrease of 85%.

Table of import of carbon fiber by country and region from February 2021 to June

In terms of import sources, Japan, Taiwan, South Korea, the United States and Mexico account for 88% of the total import volume. From the perspective of major domestic import provinces, the top three are Jiangsu Province, Guangdong Province and Shandong Province, accounting for about 76%. In terms of trade mode, the total import volume of general trade was 5325 tons, a year-on-year decrease of 36%, accounting for 36%. The number of incoming / incoming processing / bonded area business was 9414 tons, up 4% year on year, accounting for 64%. According to preliminary statistics, more than 90% of them are used in the field of cultivation equipment and wind turbine blades.

Table 2 carbon fiber products imported from Japan from January to June 2022 (tons)

In the first half of 2022, China imported 4306 tons of carbon fiber products from Japan, with a year-on-year increase of 14%. The main reason is that in the first half of 2021, affected by the "Toray storm", Japan's export volume to China has decreased. In the first half of 2022, although there was a growth in exports, the increase was not obvious. It was mainly affected by the demand growth of Japan and Europe and the United States. The carbon fiber exported from Japan to the Chinese market is still relatively tight. The obvious decline in the import of carbon fiber fabrics is due to the shortage of carbon fiber supply in 2021, and many enterprises turn to purchase carbon fiber fabrics not affected by the license. However, with the gradual recovery of global supply and the increase of domestic carbon fiber supply, the import of carbon fiber fabrics is significantly reduced. The import of carbon fiber prepreg increased year on year, mainly due to the guaranteed quality and good brand effect of carbon fiber prepreg in Japan. However, it should be noted that the general trade of carbon fiber prepreg accounts for only 13% and the proportion of incoming / imported processing is as high as 87%. It can be seen that the main flow direction is OEM based sports goods industry. On the whole, since Japan imported carbon fiber products / feed processing, bonded trade, accounting for 56%, the main use is still OEM based sports goods industry.

Table 3 carbon fiber products imported from Taiwan, China, from January to June 2022 (tons)

In the first half of 2022, 2686 tons of carbon fiber products were imported from Taiwan, a year-on-year decrease of 23%, which was mainly due to the decrease of domestic wind turbine blade demand and the combined influence of price factors.

Table 4 carbon fiber products imported from South Korea from January to June 2022 (tons)

In the first half of 2022, China imported 2381 tons of carbon fiber products from South Korea, a year-on-year increase of 9%. The main export enterprises are Toray Korea and Korea Xiaoxing, and the products are mainly T700 Carbon fiber. One of the main reasons for the slow growth of import volume is also affected by the "Toray storm". In the first half of 2021, the supply base for China is low. At the same time, it is affected by the demand growth of South Korea, European and American markets, and the increase of domestic T700 carbon fiber supply.

Table 5 carbon fiber products imported from the United States from January to June 2022 (tons)

In the first half of 2022, China imported 1856 tons of carbon fiber products from the United States, a year-on-year decrease of 15%. The import volume of carbon fiber decreased by about 20%. The main reason is that the amount of carbon fiber that can be exported to China decreased due to the increase of demand of the main customers in the United States and Europe. As the global aviation industry continues to recover, it is expected that the amount of carbon fiber that the United States can export to China will remain low in the second half of the year.

Table 6 carbon fiber products imported from Mexico from January to June 2022 (tons)

In the first half of 2022, China imported 1847 tons of carbon fiber from Mexico, with a year-on-year increase of 17%, about 200 tons. The export enterprise is Zoltek company. The main purpose of the products is in the field of wind power, and the main trade mode is feed processing and re export.

Table 7 import situation of carbon fiber in China

In the first half of 2022, Guangdong, Jiangsu, Shandong and Fujian provinces imported 12009 tons of carbon fiber products, accounting for 81% of the total imports. From the perspective of trade mode, processing with imported materials and bonded trade accounted for more than 65%, and the quantity accounted for 71% of the total import volume of the four provinces. Combined with the analysis of local industries, the processing of incoming materials in Shandong and Jiangsu is mainly used in wind power, while Guangdong and Fujian are mainly used in sporting goods.

　　 3、 Production and marketing of domestic carbon fiber

　　 （1） Capacity

According to incomplete statistics, in the first half of 2022, the new production capacity of domestic carbon fiber industry is about 19000 tons, and by the end of June, the domestic total production capacity is about 74700 tons, of which the actual production capacity of 1K / 3K / 6K is about 1900 tons, the production capacity of 12K / 24K is about 29800 tons, and the production capacity of large tow of 25K and above is about 43000 tons. In the second half of the year, domestic related enterprises announced that the planned production capacity was still about 40000 tons, including 11500 tons of carbon fiber with 25K and above large tow and 28500 tons of 12K / 24K (some production capacity can be converted into large tow of 25K or above). It is estimated that China's carbon fiber production capacity may reach 110000 tons, which will exceed Japan's global capacity (including the capacity of zoertec purchased by Toray).

　　 （2） Capacity utilization and sales

According to incomplete statistics, in the first half of the year, the domestic production of carbon fiber is about 21000 tons, and the sales volume is about 19000 tons. Combined with the situation of carbon fiber import, the domestic consumption is about 33700 tons, accounting for 54% of the total consumption in 2021. In view of the fact that some 12K / 24K production lines are used to produce T800, M40 and other high-grade carbon fibers, the actual output of some enterprises is reduced, and some enterprises have put into operation their new production capacity. It is preliminarily estimated that the overall domestic capacity utilization rate is about 90%. From the perspective of product prices, the prices of major domestic carbon fibers remained basically stable in the first half of the year. However, considering the reduction of domestic wind power and sporting goods consumption, as well as the increase of domestic supply, it is expected that the price of carbon fiber with large tow will decrease in the second half of the year, but the price of carbon fiber of T700 and higher grades will remain relatively stable.

　　 （3） Analysis of main application fields

　　 1. Wind turbine blade

In the first half of the year, a number of domestic enterprises released carbon fiber or carbon glass composite plate girder blade. In May 2022, Yunda and Zhongfu Lianzhong will launch the yd110 offshore blade (110m long); In June, Mingyang intelligent production line 111.5m anti typhoon offshore blades; In July, Shanghai Electric put off line S112 ultra long offshore wind turbine blades (up to 112 meters).

However, it should be noted that the state subsidy for offshore wind power has been cancelled since 2022. Although some local governments can subsidize the construction of local offshore wind power projects, it can be predicted that offshore wind power has entered the era of parity, which requires carbon fiber enterprises to continuously improve technology, create scale-up cost advantages, and create good basic conditions for large-scale use of carbon fiber in offshore blades.

　　 2. Photovoltaic

Under the background of carbon peak carbon neutralization goal leading and global clean energy accelerating application, China's photovoltaic industry has achieved rapid growth in the first half of the year. According to the operation situation of China's photovoltaic industry in the first half of 2022 released by the Ministry of industry and information technology on July 20, the main links of the national photovoltaic industry chain maintained a strong development momentum, with year-on-year growth rates of more than 45%. The total output of polysilicon increased by 1.373 million tons to 1.374 million tons in the same period of last year. The output of silicon wafers was 152.8gw, up 45.5% year on year; The output of solar cells was 135.5gw, with a year-on-year increase of 46.6%; The module output was 123.6 GW, up 54.1% year on year.

Affected by the gradual balance of supply and demand, and the continuous growth of silicon prices, the cost pressure of host manufacturers has increased, and the pressure of cost reduction has been transferred to the former carbon fiber materials. In addition, the inventory of carbon carbon deposition enterprises and downstream enterprises last year, the prefabrication market in the first half of the year showed a low price and reduced demand. However, due to the large proportion of photovoltaic energy in China and the influence of the concept of "photovoltaic hydrogen generation", the application prospect of carbon fiber in photovoltaic field is still broad.

　　 3. Pressure vessel

In the first half of the year, affected by the epidemic situation and local government subsidies, the development of hydrogen storage cylinders did not meet the expectations, and the total number of loaded hydrogen cylinders was less than 2000. It is expected that the second half of the year will gradually improve and maintain the momentum of growth. The market of compressed natural gas (CNG) cylinders increased by more than 50% year-on-year due to the favorable factors of rising international oil prices.

　　 4. Sports leisure

Thanks to the promotion of European sports products, especially bicycle subsidy policy, and the production capacity of other sporting goods manufacturing countries, China's demand for carbon fiber in the field of sports and leisure is booming in 2021. In 2022, with the growth of demand gradually returning to normal, the demand for carbon fiber in sports and leisure field will decline in the first half of the year, and will continue to decline in the second half of the year, but the overall consumption is expected to return to the level of 2020 or slightly decline.

　　 4、 Main business of key enterprises keeps growing

The main business of leading carbon fiber enterprises continued to grow. In the first half of the year, Weihai Guangwei composite materials Co., Ltd. achieved a revenue of 1.314 billion yuan, a year-on-year increase of 2.42%, and a net profit of 506 million yuan, a year-on-year increase of 16.48%. In the first half of the year, Jilin Carbon Valley Carbon Fiber Co., Ltd. achieved a revenue of 1.088 billion yuan, a year-on-year increase of 144.03%, and a net profit of 335 million yuan, a year-on-year increase of 204.81%. In the first half of the year, Jiangsu Hengshen Co., Ltd. achieved a revenue of 505 million yuan, a year-on-year increase of 24.83%, and a net profit of 116 million yuan, a year-on-year increase of 124.73%.

　　 5、 Summary

On the whole, China's carbon fiber industry is still maintaining a positive development trend, and various application fields at the demand side also maintain a certain growth. However, we should pay special attention to the imbalance between supply and demand in a certain period of time due to excessive capacity growth. In addition, due to the influence of industrial structure and industrial chain discourse power, individual application fields, especially energy fields, will inevitably have very strict requirements on the price of carbon fiber, and the appropriate price is an important factor to promote the production and sales growth of relevant application fields. In the past few years, the production capacity and quality of domestic carbon fiber have been recognized by more and more industrial fields. The author thinks that relevant carbon fiber enterprises can consider going abroad. China's carbon fiber has the ability and should participate in the international market competition, and gradually expand the global discourse power of China's carbon fiber industry.

In addition, there will be a sharp increase in the production capacity of prepreg manufacturers in 2022, such as the rapid growth of production capacity in the textile industry, More enterprises will invest in the R & D process needed by the industry to accelerate the survival of the fittest, which will play a great role in promoting China's carbon fiber composites to participate in the global competition.

Finally, in the process of steady development of China's carbon fiber industry, there is still a need for upstream and downstream cooperation efforts and more dialogue to jointly promote the application of carbon fiber composites in a wider and deeper field. (author: Chen Yuhang China Chemical Fiber Co., Ltd.)

(source: China Chemical Fiber Industry Association)