At present, China has become the most important producer and consumer

[Industry chain analysis]

Bottle-grade polyester chip is made from refined terephthalic acid (PTA) and ethylene glycol (MEG). It is a copolymerized product. Its scientific name is polyethylene terephthalate (PET). Bottle-grade PET has uniform crystal structure. As a kind of packaging consumables, the product has many advantages, such as safety, low price, high transparency, light weight, 100% recycling and so on. It is mainly used in beverage and food packaging, specifically involving carbonated beverages, edible oils, condiments, quick-frozen food, beer, liquor, pesticides, medicine, cosmetics, personal care products and so on. Due to the advantages of low cost and energy saving, polyester bottles will be used in packaging instead of glass bottles with the improvement of people's living standards and the strengthening of environmental awareness.

PET includes polyester fiber (polyester), polyester bottle chips and polyester film. In the domestic market, polyester fiber accounts for more than 75%, including polyester filament and staple fiber, etc., mainly used in the textile industry; polyester bottle chips account for about 20%, mainly used in soft drinks, edible oil, wine packaging bottle packaging, accounting for about 90% of the total demand. Domestic sheet packaging has great potential for development, but the proportion is only around 13% at present.

[Global supply and demand situation]

Global supply of polyester bottle chips

From 2009 to 2019, the global production capacity of polyester bottle chips continued to grow positively, from 17.859 million tons to 33.229 million tons, of which the growth rates of global production capacity in 2011 and 2018 reached 10.7% and 9.4% respectively. In the double-dip process after the global economic crisis in 2016, energy and chemical products are basically in the bottom recovery period, and the growth rate of polyester bottle chip production capacity has dropped sharply. The production capacity of polyester bottle chips continued to expand in 2018 and 2019, and the overall capacity utilization of polyester bottle chips gradually declined, of which the global capacity utilization rate in 2019 was only 72.5%. This is mainly due to the continued decline in capacity utilization in North America and China, the two major contributors to production capacity. In the past 10 years, the global consumption of polyester bottle chips has maintained a low and steady growth trend. According to Bloomberg data, by 2019, the global bottle-grade PET production capacity has reached 33.23 million tons, with consumption of 24.09 million tons.

From the point of view of the global supply distribution of polyester bottle chips, the global production capacity of polyester bottle chips in 2019 is mainly concentrated in Asia, North America and Europe, accounting for about 85% of the global production capacity, of which Asia accounts for more than 50% of the global production capacity. it is the fastest growing region in the industry in the past decade. Europe and the United States are the traditional birthplace and producing place of polyester bottle chips, but with the change of industrial pattern and consumption area, there is not much new production capacity in Europe and America, and some old production capacity is gradually withdrawn. From the point of view of the production capacity distribution of polyester bottle chips, it is mainly distributed in China, the United States, India, South Korea and so on, accounting for about 54% of the world. With the global production capacity of polyester bottle chips increasing year by year, China's share of global production capacity also continues to increase, from about 20% in 2008 to about 35% in 2019.

In addition, the global polyester bottle chip production capacity concentration is relatively high, the top 10 production enterprises are Indorama, DAK, far East Group, Sanfang Lane, Yisheng, China Resources, Wankai, Chengxing, Trust, Rakuten, with a total production capacity of 21.73 million tons, accounting for about 65% of the world. Among them, Indorama occupies a leading position in the industry, while in recent years, the new production capacity is mainly concentrated in China's leading enterprises, including Wankai, Yisheng, Sanfang Lane and so on.

Global consumption of polyester bottle chips

From the perspective of global polyester bottle chip consumption, the global polyester bottle chip consumption in 2019 is mainly concentrated in North America, China and Western Europe, accounting for 58% of the global consumption. From the specific consumption field of polyester bottle chips in the world, the consumption of polyester bottle chips in 2019 is mainly concentrated in mineral water bottles, CSD bottles, packaging and film, accounting for about 73% of the total consumption. Different from polyester fiber, bottle-grade PET capacity distribution is mainly dispersed according to population base, economic level and consumption habits. In the past 10 years, the largest consumption of polyester bottles in the world has gradually changed from carbonated soft drink bottles to mineral water bottles. In 2019, mineral water bottles accounted for 33% of the global consumption of polyester bottles, which is related to the change of people's consumption concept in recent years. The production of packaging water and healthy beverages has maintained a relatively rapid growth rate, while carbonated drinks has maintained a low growth level.

In addition, based on safety, economy, environmental protection and other advantages, bottle-grade PET has become the fastest growing packaging materials in recent years, and gradually replaced other packaging materials. According to SBAcci statistics, since 2000, the compound growth rate of PET demand in the United States has reached 6.2%, while the demand for aluminum and glass products has shown negative growth in the same period, and the substitution trend is obvious.

The trend of global trade in polyester bottle chips

Judging from the global trade flow of polyester bottle chips, the net outflow of polyester bottle chips is mainly concentrated in Asia. China is the largest net exporter in the world, and the overall export volume shows a rapid growth trend; the net export volume of Northeast Asia, South Asia and Southeast Asia is gradually shrinking, and its share is gradually occupied by China. In addition, North America was also a net export area before 2014 and a net import area after 2014, and the net import volume has increased year by year. The net inflow of polyester bottle chips is mainly concentrated in South America, Europe, the Middle East and Africa, in which net imports in the Middle East and Africa have increased significantly in recent years, while Europe and South America as a whole are relatively stable.

[China's supply and demand and import and export situation]

Supply of polyester bottle chips in China

At present, China has become the most important producer and consumer of polyester bottle chips in the world. From the point of view of the domestic polyester bottle chip market supply, there was a peak of production expansion in 2012, the industry entered the stage of overcapacity, the industry profits were rapidly compressed, and then the industry production atmosphere fell back. Since 2014, the polyester bottle chip industry has entered the stage of spontaneous capacity loss. In addition, under the national supply-side reform policy, there is no new production capacity in the polyester bottle chip industry from 2015 to 2016. After the elimination of production capacity and the digestion of excess capacity from 2014 to 2016, the production capacity of the polyester bottle chip industry returned to positive growth in 2017, with the expansion of China's leading enterprises such as Wankai, Sanfang Lane and Yisheng. The growth rate of domestic bottle chip device production slowed down in 2019, only Dalian Yisheng 350000 ton plant was successfully put into production, and most other devices may be postponed to 2020 due to engineering or market changes. According to CCF data, as of 2019, the total production capacity of polyester bottle chips in China was 10.51 million tons, an increase of 3.4% over the same period last year; production was 8.85 million tons, an increase of 8.5% over the same period last year; and apparent consumption was 5.99 million tons, an increase of 9.3% over the same period last year.

From the perspective of the product structure of polyester bottle chips, there are mainly water bottle slices, hot pot bottle slices, carbonate bottle slices and oil bottle slices, accounting for 57%, 19%, 15% and 9% of the total output of polyester bottle chips, respectively. From the point of view of the production capacity distribution area of polyester bottle chips in China, the production capacity of polyester bottle chips is mainly concentrated in East and South China, of which the four provinces with the largest production capacity are Jiangsu, Hainan, Guangdong and Zhejiang, accounting for 86% of the total production capacity. From the perspective of polyester bottle chip production enterprises, the concentration of polyester bottle chip industry in China is increasing continuously. The production enterprises with a production capacity of more than 1 million tons / year are Sanfang Lane, China Resources, Yisheng, Wankai and Chenggao, accounting for more than 75% of the total production capacity of domestic bottle chips.

Domestic consumption of polyester bottle chips

Domestic polyester bottle chip consumption field is mainly concentrated in soft drinks, edible oil, wine packaging bottle packaging, accounting for about 90% of the total demand; domestic sheet packaging has great development potential, but the proportion is only around 13%. In recent years, with the growth of consumption base, the growth rate of bottle packaging in traditional market applications, such as beverages and edible oil, has gradually slowed down. At present, the downstream application field of polyester bottle chips is based on the field of beverage bottles and food packaging, gradually extending to daily chemical products, stationery, toy packaging and other fields, and gradually replacing other packaging materials.

As the largest downstream product of polyester bottle chips, the market of bottled beverages directly affects the market of polyester bottle slices. Before 2010, the growth rate of domestic soft drink production was maintained at more than 20%, and the overall growth rate had a downward trend year by year. Since 2013, the production growth rate has rebounded, but due to the implementation of the ban on "three public consumption", the number of meals has decreased significantly, and the consumption of soft drinks has also decreased significantly. The output growth rate of the soft drinks industry continued to decline in 2015 and 2018. With consumers' pursuit of healthy drinks, packaged water and healthy drinks have maintained a relatively rapid growth rate in recent years, while carbonated drinks have maintained a low growth level. In addition, with the rapid development of industries such as takeout, the consumption of polyester bottles in fruit and vegetable boxes and other sheet areas also has a good growth rate. From the perspective of future development, healthy drinks, tablets and other emerging areas will become a high speed-up point.

Import and export of domestic polyester bottle chips

China is the world's largest net exporter of bottle chips, accounting for 40% of the world's bottle chips exports. Since 2015, the export volume of polyester bottle chips has increased year by year. In 2019, China's exports of polyester bottle chips reached 2.9 million tons, accounting for 33% of domestic output, while imports were only 45800 tons. China's polyester bottle chips are exported to more than 100 countries and regions, among which India, the Philippines, the Russian Federation and Algeria are the four major exporters of polyester bottle chips in China in recent years, accounting for 24% of the total export volume. Before Japan imposed anti-dumping duties, Japan was one of the most important export markets for Chinese polyester bottles, accounting for about 20% of total exports. With the decline in the proportion of exports to Japan, the proportion of exports to India is gradually increasing, from 2.5% in 2016 to 9.4% in 2019.

Affected by the overseas COVID-19 epidemic in 2020, foreign demand has been greatly reduced, and the export of polyester bottle chips has dropped significantly compared with 2019. Apart from the fact that the overseas epidemic has affected part of the demand, there are also three main factors restraining the export of Chinese bottle chips: first, the exchange rate of RMB against the US dollar fluctuates violently, and the exchange rate risk increases, and some overseas customers break contracts or delay implementation in some periods of time; second, shipping costs rise sharply in some areas; third, foreign anti-dumping impact on domestic polyester bottle chips. South Africa stopped importing polyester bottle chips from China in January 2020 and announced anti-dumping duties on polyester chips from China in May 2020; the Indian government issued preliminary results of anti-dumping investigations and began to impose temporary anti-dumping duties.