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DME China Market Faces Huge Challenges

By Chen Qiaolian, Jiutai Energy Group Marketing Center

Recent years, the prospect of the DME million tons per year, of which there 1.Single product usage and potential
(dimethyl ether) China Market is filled are 4 sets of a total 400 000 t/a unit has hazards, which hold back its healthy
with dread, due to its excessively been completed, the program in the market development.
expanding output, single product usage, production, including Linyi Yuanbo More than 90% of DME is for
lack of supportive policies and poor Chemical Co., Ltd.’s 200 000 t/a unit, liquefied gas mix, with mixing ratios
market connections. In addition, lots of gas Hebei Chengde Kuanqing New-style as high as 80%, a security hazard. 2012
supply companies are operating against Gas Comnpany’s 150 000 t/a unit, Hebei China's domestic operating rate was
the regulations, bringing more potential Ta n g s h a n H a r b o r X i n g e r u i E n e rg y down to 36% from 2011 an average of
hazards. Also affected by other market Co’s 50 000 t/a and Chongqing Deya 40%.
obstructions, the path of its development Chemical Co, 50 000 t/a. 2.Lack of national policy guidelines,
has been hindered. areas of application development is

Two. Overseas Market restricted.

One. Increasing Output Potential Although the liquefied petroleum


gas (LPG) and dimethyl ether Mixed
By the end of May in 2013, there are Compared with the booming supply, Gas standards and LPG and dimethyl
86 DME manufacturers in China, whose the demand for DME continues to have ether mixed gas cylinders standard
annual production capacity is 11 billion a stable situation. The Chinese DME of have completed, promulgation and
tons. 12 of them are in HeBei province, the consumption structure, civilian fuel implementation date are uncertain.
with 2.1 billion capacity, covering 18% of accounted for the absolute dominance, Vehicle manufacturers and operators face
the whole production; 12 of them are in in 94%, and vehicle fuel is only 2% and lack of policy guidelines, the new energy
HeNan province, with 1.6 billion capacity, the other used as foams, aerosols 4%, lack of awareness, lack of development,
covering 14% of the whole production; 10 and civilian fuel, more than 90% of the that the current for an existing energy
of them are in ShanDong province, with liquefied gas mixture. research and development is fundamental
1.2 billion capacity, covering 10% of the C h i n a ’s D M E m a i n l y e x p o r t s t o to the place.
whole production. All the three provinces Southeast Asia, in Viet Nam, Thailand, 3. Macroeconomic downturn.
mentioned above account for 40% of the imports of these countries DME is mainly The global economic crisis has
nationwide production. There are also used as a blending of liquefied gas, through been nearly 5 years, but the world
many DME factories in HuNan and HuBei 1000 to 2000 tons of ship to ship, each economy has not yet fully recovered,
provinces, Southeast and Southwest China. year about 30 000 tons. Overseas market the developed countries' economic
The factory for 800 000 t/a DME was expansion, extending the application downturn affecting developing
in production operated by the XinJiang of the DME market area, if the healthy countries, and the export growth has
GuangHui Group at the end of last year, development of the export market, China declined. Because of the economic
which marked a sharp rise in the DME will effectively alleviate the problem of environment remains weak, dimethyl
share of Northwest China. While there is excess production capacity of DME. ether industry is affected, it is expected
little effect on the real market, for those that in the year 2013, the weak
equipment is in unused condition. Three. Development economic recovery, China dimethyl
In 2013,Chinese domestic construction Challenges ether operating rate will remain at a
DME production capacity of about 9 low level. 

CHINA CHEMICAL REPORTER November 21, 2013


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