Background brief description China's methane chloride industry gradually developed after the formation of small-scale industrial installations in the 1950s. The first to achieve industrialization were methylene chloride and chloroform. Methyl chloride is a raw material for silicone and started together with the silicone industry in the 1980s. Driven by the development of the silicone industry, methyl chloride has also experienced rapid development.

Methyl chloride production route and related policies There are two sources of methyl chloride circulating in the Chinese market: one is methyl chloride prepared through chemical synthesis; the other is as a by-product during the production of glyphosate. The by-product yield is 1:1. Two kinds of methyl chloride are available. The mass of methane is essentially the same.

Chemical synthesis methods include methanol chlorination and methane chlorination. The methanol chlorination method uses methanol and hydrochloric acid as raw materials, and uses ferric chloride or zinc chloride as a catalyst to react. The resulting crude product is dried, compressed, and condensed to obtain the finished product of methyl chloride liquid. In this method, methyl chloride is The only product. The methane chlorination method uses methane and chlorine as raw materials. The methane is chlorinated by passing chlorine gas at high temperature. The chlorinated product is absorbed by water to remove hydrogen chloride. After the unreacted methane is separated by compression and condensation, the finished product is obtained by fractionation. Methyl chloride and polychlorides. The methanol chlorination method has the advantages of easy availability of methanol raw materials, high utilization rate of methanol and chlorine, few by-products and high product quality. It is currently the mainstream chemical synthesis process.

Methyl chloride has been classified as a "high pollution, high environmental risk" product since 2015, and is still classified as a "high pollution" product in the "Comprehensive Environmental Protection Directory (2021 Edition)" (3) issued by the Ministry of Ecology and Environment on October 25, 2021. pollution, high environmental risk" product list. At the same time, its raw material methanol (except natural gas, coke oven gas, and the combined alcohol-to-methanol process) is also classified as a "double-high" product. "Double-high" products do not enjoy VAT preferential treatment for comprehensive resource utilization products and labor services.

The advantages of by-product methyl chloride appear In 2023, China's nominal production capacity of methyl chloride (including the self-built production capacity of organic silicon companies) is 4.61 million tons/year; excluding the self-produced and self-used portion of organic silicon companies, the production capacity of methyl chloride for export products is approximately 1.15 million tons/year (glyphosate, etc. The production capacity of other by-products is 390,000 tons/year), the output of export products is about 750,000 tons, and the operating rate is 65.2%. The total production capacity of the top three companies in terms of production capacity accounts for 51% of the total production capacity of exported products, indicating a high degree of industrial concentration.

From a supply perspective, although leading silicone manufacturers will choose to supply methyl chloride themselves in order to maintain cost and supply stability, in order to reduce excessive initial capital investment, there will also be small companies that choose to outsource all methyl chloride. Methane. At the same time, the rapid development of organic silicon in recent years has caused organic silicon production companies to operate at high or even overload capacity, which has greatly increased the outsourcing demand for methyl chloride. Therefore, the construction level of the methyl chloride industry has remained in a relatively healthy state.

Starting from the beginning of 2022, the global economic growth has slowed down, downstream consumption has been weak, and China's organic silicon production capacity has expanded too rapidly in recent years. The market price of organic silicon has continued to fall sharply, and the cost pressure on organic silicon manufacturers has increased. At this time, compared with the manufacturing enterprises that prepare methyl chloride through chemical synthesis of methanol, the price advantage of enterprises that by-produce methyl chloride gradually becomes apparent. Since there is no big difference in quality, silicone manufacturing enterprises will give priority to by-product methyl chloride. Produce methyl chloride products to reduce production costs.

According to the statistics of existing projects under construction and planning, it is expected that by 2028, China's methyl chloride export products will have an additional production capacity of 105,000 tons/year, and the total production capacity will reach 1.255 million tons/year.

Silicone downstream high-growth industries，Drive growth in demand for methyl chloride In 2023, China's total consumption of methyl chloride will be approximately 3.14 million tons. Excluding the self-produced portion of organic silicon enterprises, commodity consumption is 740,000 tons, with a compound annual growth rate of 6.5% from 2018 to 2023. The main downstream application areas are the production of organic silicon, methylcellulose and pesticides.

In terms of import and export, the trade volume of methyl chloride is low. In the downstream consumption of methyl chloride, the consumption in the field of silicone will account for 70% in 2023, the consumption of methylcellulose will account for about 23%, and the consumption in other fields such as pesticides will account for 7%.

Benefiting from the high-growth downstream industries of silicone, such as electronic appliances and medical care, as well as some new application fields such as methylphosphine dichloride, China's consumption of methyl chloride is expected to grow at an average annual rate of about 7% from 2023 to 2028. Growth, by 2028, China's commercial demand for methyl chloride will reach 1.04 million tons (excluding self-production and use by silicone companies). In terms of downstream applications, it is expected that the consumption proportion of methyl chloride in organic silicon will increase to 75% in 2028, the consumption proportion of methylcellulose will be 18%, and the consumption proportion of pesticides and other fields will be 7%.

It is worth being vigilant that if silicone companies continue to rapidly expand production capacity in the future or downstream consumption develops less than expected, serious overcapacity will occur and industry competition will intensify. In this case, small and medium-sized silicone companies may be eliminated first due to their disadvantages in cost, customer stickiness and brand awareness, thereby reducing the purchase demand for methyl chloride. At this time, glyphosate by-product chloromethane Methane companies may also face the risk of reduced profits or unsaleable products.

At present, although the supply and demand of the methyl chloride industry are relatively balanced, the development is healthy. However, downstream applications are too dependent on silicone, and the development of silicone directly affects the methyl chloride industry. In recent years, against the background of the gradual overcapacity of the silicone industry, chemical synthesis methyl chloride production companies have suspended production due to high costs and lack of surrounding silicone industry clusters, while glyphosate by-product methyl chloride companies have It has not been affected, and the advantages have gradually emerged.

Note: This article is reprinted from China Chemical Information Center Co., Ltd.