On July 28, the second phase of the Xinfengming PTA project was successfully completed. The chairman of the group, Zhuang Kuilong, and the president, Zhuang Yaozhong, visited the site to inspect and accept the progress of the second phase of the PTA project. As early as 100 days ago – April 20, a swearing-in meeting was held at the construction site of the project to strive for the 728 CCCC.
After the project is handed over, the project will start debugging immediately. It will be put into production at the end of the third quarter. By then, the company’s PTA production capacity will reach 5 million tons, and PTA will be fully self-supplied, providing reliable raw material guarantee for subsequent spinning, improving the company’s ability to resist risks and comprehensive strength, and laying the foundation for the smooth conclusion and success of “Rebuilding a New Fengming in Three Years” The successful realization of “two 5 million tons” has delivered a perfect answer.
It is understood that the total planned investment of Dushan Energy New Materials Integration Project exceeds 13 billion yuan, using internationally advanced technology technology, configure automated and intelligent facilities, and create a digital management system. Material consumption, energy consumption, and emissions have reached world-class levels, further moving towards green, low-carbon, intelligent, and digitalization. After the completion of the project, the Dushan base will have an annual production capacity of 9 million tons of PTA and 2.1 million tons of functional fibers. It is expected to have annual sales of 60 billion yuan and profits and taxes of 6 billion yuan, becoming a pillar industry in the Dushan Port Economic Development Zone.
Get rid of the embarrassing situation of raw materials being controlled by others, Xinfengming is expected to become the three new PTA giants
PTA and ethylene glycol are the main raw materials of polyester fiber, accounting for about 85% of the production cost of polyester filament. For many years, the control of raw materials has been a headache for chemical fiber companies. Only by extending the industrial chain upstream and achieving integrated production can it be highlighted to the greatest extent. advantages to maximize profits.
It is understood that Xinfengming’s current products are mainly POY, with sales accounting for an average of more than 75% in the past five years. In 2018, due to the lack of integration of its own industrial chain, the market price of PTA rose sharply, and the cost of raw material procurement increased, causing the company’s POY gross profit margin to fall back to 10.45%.
In order to improve the company’s industrial integration and risk resistance Capacity, Xinfengming invested in a 4.4 million-ton PTA project in Dushangang Economic Development Zone, Pinghu City, Zhejiang Province in 2018. The project is planned to be constructed in two phases, with a scale of 2 sets of 2.2 million tons per year, and a total planned investment of 7 billion yuan. This additional increase will help the company improve the integrated layout of the industrial chain, further enhance its scale advantage, improve its overall competitiveness, and consolidate and enhance its industry position. At present, the second phase of the PTA project is progressing in an orderly manner and is expected to be put into production by the end of 2020. By then, Xinfengming’s PTA production capacity will reach 5 million tons, and it is expected to join the ranks of the three new PTA giants.
The polyester giant that spends money first and asks for money later: Expand upwards!
After 2010, a large number of domestic private chemical fiber companies have built new PTA and polyester devices, with leading production capacity, expanded market share, advanced technology, and efficient operation. Hengli Co., Ltd. Tongkun Petrochemical, Rongsheng Petrochemical, and Hengyi Petrochemical have become China’s four largest listed private chemical fiber giants. According to statistics, from April 2019 to 2025, approximately 42 million tons of PTA production capacity will be added in China, and the total production capacity will reach approximately 90 million tons. Private enterprises such as Hengli, Tongkun, and Yisheng have the dominant share.
In contrast, most of the remaining PTA manufacturers are state-owned PTA factories under Sinopec and small private factories. The PTA production equipment was put into operation early, the technology is relatively backward, the product production cost is high, the competitiveness is weak, and it faces the fate of being eliminated in the market.
Since the decentralization of paraxylene (PX) approval authority, in recent years, Rongsheng, Hengyi, and Hengli Leading companies in the chemical fiber industry such as Tongkun and Tongkun have made great efforts to extend the industrial chain upstream, integrating the entire production chain from crude oil-PX-PTA-PET-textile from top to bottom.
As an industry leader, Rongsheng Petrochemical owns Zhongjin Petrochemical, with an annual production of 2 million tons of aromatics, currently accounting for about 11.5% of the total aromatics production capacity; Hengli Group’s 20 million tons/year refining and chemical integration project in Changxing Island, Dalian has been put into operation; Hengyi Petrochemical’s Brunei PMB petrochemical project achieved full-process integration and integration of the factory on November 3 last year. Fully put into operation, the project has a crude oil processing capacity of 8 million tons/year and a paraxylene production capacity of 1.5 million tons/year; after the completion of the Zhejiang Petrochemical Refining and Chemical Integration Project, a joint venture between Rongsheng Holdings and Tongkun Group, it will have a capacity of 40 million tons /year oil refining, 8 million tons / year paraxylene, 2.8 million tons / year ethylene production capacity and scale, the current phase one project has been fully put into operation; Shenghong refining and chemical integration project is also intensifying progress, after completion will form 1600 10,000 tons/year oil refining, 2.8 million tons/year PX, and 1.1 million tons/year ethylene production capacity. Xinfengming Group’s “14th Five-Year Plan” goal is to achieve the goals of 10 million tons of PTA production capacity, 10 million tons of polyester production capacity, and 100 billion yuan in revenue.
The upstream and downstream integration process of leaders in each sub-field is crucial to the future pattern of the chemical fiber industry. It is the first to complete the upstream expansion. The company will have a first-mover advantage in the competition, especially to earn excess revenue that is not fully competed in the large refining and chemical sector.Benefit part. While reducing external dependence on raw materials and achieving profit retention in the entire “crude oil-PX-PTA-polyester” industry, it also improves its own ability to withstand risks and impacts.
Price has been slashed, profits are calling, and latent excess production capacity has been awakened!
Competition in the polyester and polyester industry is still fierce, and the adjustment and optimization of the overall industrial structure will still take a period of time. Against this background, we will continue to expand our scale to further demonstrate our comprehensive advantages such as scale. It has become the focus of enterprises, and extending to upstream industries has also become an industry trend. At the same time, in the first half of 2020, domestic PTA prices returned to 5,000 yuan/ton, which was almost halved from the highest price of 9,200 yuan/ton in September 2018. The industry boom that lasted for more than a year has come to an end. This wave of rising prices is caused by the withdrawal of production capacity in the PX industry. The five-year industry downturn has caused 25% of the domestic PX industry production capacity to cease operation. However, PTA prices did not stand still after a brief surge, but quickly fell back. Under the call for profits, latent excess production capacity has been awakened. As it is difficult to make a breakthrough in the export market in the short term, competition will become fierce. </p
