SHANGHAI — China's engineering plastics industry needs to grow mindfully, Zheng Kai, secretary general of the China Synthetic Resin Association, told Plastics News.
"The biggest challenge is that the production capacity is greater than the need," he said, in an interview on the sidelines of the Society of Plastics Engineers' first conference in China. "This is a big problem in China especially."
He gave as an example polybutylene terephthalate resin, which he said has an annual production capability of 900,000 tons in China, but only has an actual need of 300,000 tons.
"So it has created a lot of waste of resources," he said. "We need to allocate this production capability in a reasonable manner, and avoid vicious competition."
Zheng presented an update on China's plastics industry to conference attendees. According to the statistics he presented, the growth rate for China's plastics processing industry is slowing. Production as a whole continues to grow, but at a slower pace in 2012 than in the previous year.
Zheng reported that last year China's plastic resin output was 52.1 million tons, up 5.5 percent from the year before. Net imports were 14.39 million tons, and apparent consumption was 79.743 million tons, representing an increase of 4.9 percent.
In the first half of 2013, 28.3 million tons of plastic resin was produced, an increase of 7.8 percent over the same period a year ago. By 2015, he told the conference, China's synthetic resin output will reach about 64 million tons.
Zheng told attendees that while in the past the growth rate was always 8-9 percent, this year it was 7-8 percent.
"My personal belief is that we're not even at 8 percent," he said. Later he told Plastics News that the growth rate numbers seem a bit off to him. "We're always a bit above the GDP, but [in 2013] the GDP was above 7.5 percent," he said. "So either our numbers are too low or the GDP numbers are too high."
Currently there are 13,246 plastic processing enterprises in China with sales of 20 million yuan or more. 57,818,600 tons of plastic products were produced, an increase of 8.99 percent from the same period a year ago. Some 13,821,600 tons of plastic products were exported, valued at about $49 billion.
Engineering plastics consumption will rise to more than 3 million tons this year, with about half of that imported. PBT consumption, frequently used in China's electronics manufacturing sector, is increasing the fastest, Zheng told Plastics News. But polycarbonate is still consumed the most, making up about 50 percent of the total engineering plastics consumed. This is because of its use in construction, water bottles, food manufacturing, telephones and computer housings.
Those in the industry need to be mindful and not be distracted by profitability, he warned attendees during his speech.
"We must have a long-term view. For China's plastics industry it is unsustainable. If we continue to blindly develop we are going to kill ourselves."