“White pollution is a huge challenge facing human society and economic development. Since the 21st century, there has been a global trend of biodegradability, and many countries have issued stricter policies to promote the development of the industry. In January 2020, my country also officially began to “limit “Plastic” has turned into “Plastic ban”, which in turn drives the degradable plastics industry from an early downturn into a period of rapid development. Due to long-term downturn development, the current industry competition is chaotic and undecided. It is possible to grasp the core elements Become a leading enterprise and lead the golden age.
This article discusses the three key points for entering the biodegradable plastics market, including “early deployment, focus on key points, and cost reduction”, in order to provide inspiration for the future development of related companies, especially the decision-making and management of corporate executives.
“Plastic ban” is issued, degradable plastics market ushered in a blowout
my country’s biodegradable plastics market has started as early as 2012. However, due to the sluggish early market demand, high raw material costs and limited production capacity, the overall development of the industry has been slow. Some companies that entered the market earlier have even been forced to transform due to long-term shortage of orders. Until January 2020, the “Opinions on Further Strengthening the Treatment of Plastic Pollution” (hereinafter referred to as the “Plastic Prohibition Order”) was issued, requiring the orderly prohibition and restriction of the production, sales and use of certain plastic products, actively promoting alternative products, and officially following “Limited plastics” turned into “Prohibited plastics” (see Figure 1).
Affected by this, the market for biodegradable plastics, which is a substitute for traditional plastics, has grown substantially, and orders have skyrocketed. During the “14th Five-Year Plan” period, the market for biodegradable plastics will grow at a compound annual growth rate of 11.3% and reach 500 The income scale of more than 100 million yuan (see Figure 2).
At the same time, the price of degradable plastic products has risen in the past year. For example, the PLA price before the plastic ban was 20,000 yuan/ton, and the market price in some places has reached 50,000 yuan/ton. This directly improves the overall profitability of the industry. For example, the gross profit margins of leading companies such as Kingfa Technology and Yifan Pharmaceutical are close to 40% in 2019 and 2020, which is a substantial increase compared to 2018 (see Figure 3).
Three steps into the degradable plastics market
1. Early layout
Due to the long-term market downturn in the early days, the domestic production capacity of biodegradable plastics has been growing slowly. According to statistics, from 2012 to 2020, this figure has a compound annual growth rate of 9.63%, and will reach 480,000 tons per year by 2020. The market demand is 640,000 tons/year, and the capacity gap is relatively large (see Figure 4).
At the same time, the production capacity gaps of major manufacturers are relatively small. The top three market shares of Kingfa Technology, Longdu Tianren Biology, and Yunyoucheng Biology will only have 70,000 tons/year and 50,000 tons/year respectively in 2020. , 50,000 tons/year. It can be said that whoever can take the lead in completing the production capacity layout will be able to seize the opportunity to obtain a larger share, and it is not difficult to catch up from behind.
But “time waits for no one,” and intensified competition is inevitable in the future. It is understood that companies are currently actively expanding, and will increase planned production capacity of more than 8 million tons/year in the next few years (of which PBAT, PLA, and PHA are 3.48 million tons/year, 3.46 million tons/year, and 100,000 tons/year respectively) , Only 3.7 million tons of newly-added production capacity has been confirmed from 2021 to 2022. In order to solve the problem of funding gaps, major manufacturers have also taken multiple measures and displayed their magical abilities. For example, Changhong Hi-Tech announced on May 21, 2021, a convertible bond issuance plan, which plans to issue convertible corporate bonds with a total amount of not more than 700 million yuan (inclusive). , The period of 6 years, the raised funds are planned to be used for the “600,000 tons of fully biodegradable thermoplastics industrialization project (phase one) second investment”; Jindan Technology and the announcement of changes to the fundraising project in January 2021, combined with the “prohibition of plastics “For policies and the future market situation of biodegradable materials, the company’s management believes that it is necessary to appropriately expand the polylactic acid production capacity of 10,000 tons originally designed. At present, the company’s board of directors is organizing relevant personnel to analyze and demonstrate the feasibility of expanding the investment scale of this project. And implementation plan.
2. Grasp the key points
According to the 2020 “Plastic Prohibition Order”, there are four types of plastic products that are mainly restricted: plastic shopping bags, disposable plastic tableware, disposable plastic products in hotels and express plastic packaging, production of ultra-thin plastic bags and ultra-thin agricultural films And sales are also restricted. At present, the replacement rate of degradable plastics in these industries is low, the highest is 25% in the express industry, and the lowest is 3% in the agricultural film industry, which is lower than the average replacement rate of 30% in the United States, the Netherlands and other countries (see Figure 6).
In the future, biodegradable plastics are expected to accelerate their popularization in many fields such as express delivery, takeaway, shopping bags, and so on. It is recommended to focus attention.
Online consumption is popular, and there is a strong demand for express packaging alternatives. The series of national standards for “Express Packaging Supplies” promulgated in 2018 first proposed that “express packaging should use biodegradable plastics”. It is estimated that domestic express delivery will consume approximately 1.52 million tons of degradable plastics in 2025.
Takeaways are growing rapidly, and there is great potential for the replacement of disposable tableware. In 2017, Meituan Takeaway, industry associations and a number of catering brands jointly launched the “Green Takeaway Industry Convention (Green Ten Articles)”. It is estimated that the domestic and foreign sales industry will consume approximately 460,000 tons of biodegradable plastics in 2025.
In some scenarios, the demand for shopping bags is stable, and the degradable penetration rate needs to be improved. Although the use of plastic shopping bags has dropped significantly since the promotion of the “plastic restriction order” in 2008, the use of plastic shopping bags has been difficult to decline due to the remaining basic demand in some scenarios. It is estimated that the domestic shopping bag industry will consume approximately 240,000 biodegradable plastics in 2025. Ton.
Traditional agricultural film has serious pollution, and the industry has ample room for substitution. Traditional polyethylene films are mostly used in China, lacking effective treatment measures, and have greater impact on soil and crops. Biodegradable mulching films have good development prospects, but the overall growth rate of the industry is slow. The demand is expected to be 150,000 tons in 2025.
3. Reduce costs
The price of non-degradable plastics such as PP, PET, PE is lower, and the price of degradable plastics is significantly higher than them. At present, the prices of mainstream degradable plastics such as PLA, PHA, and PBAT are RMB 16,000 to RMB 30,000/ton and RMB 40,000/ton respectively. Tons, about 14,000 to 25,000 yuan/ton, which is 2~5 times the price of PE, while the price of PCL is even as high as 70,000 yuan/ton, which is 9.5 times the price of PE (see Figure 7).
High raw material prices, low technology levels, and low capacity utilization are the three main reasons that lead to high prices of degradable plastics in my country. Taking PLA as an example, the one-step method has low cost but poor quality, and the two-step method has excellent quality. It is the current mainstream synthesis route, but the cost is high, about 2.3 times that of the one-step method. How to achieve high purity and low cost is the key to increase penetration and win market competition: For example, Total Corbion, a joint company of NatureWorks in the United States, Total in France, and Corbion in the Netherlands, has a low-cost and high-purity preparation process for the preparation of PLA intermediates—lactide Leading the global market, the capacity share in 2020 will reach 29.04% and 14.52% (Figure 8)
Taking a closer look at the country, leading companies are also actively breaking through technical barriers through independent R&D and cooperative R&D in order to obtain cost advantages. For example, Zhejiang Hisun and Changchun Institute of Applied Chemistry have jointly developed the lactide technology process, which has successfully offline production and realized partial self-supply; COFCO Technology and Belgian Gelat have jointly established a corn-lactic acid-lactide-polylactic acid plant in Anhui. The production base of the whole industry chain has basically mastered the production technology and processing technology of lactide. In addition, the Institute of Physics and Chemistry of the Chinese Academy of Sciences has developed a PBAT production technology with low cost, high mechanical properties, and good biological safety. Companies such as Huiying New Materials, Jinhui Zhaolong and Yuetai Biotechnology have obtained the right to use through authorization, which has also resolved to a certain extent. High cost problem.
Post time: Jul-23-2021