December 4, 2024 – China’s Caprolactam Market: Growth, Expansion, and the Need for Innovation
China’s caprolactam market has witnessed remarkable growth dynamics in recent years, with the apparent consumption soaring to 4.9795 million tons in 2023, marking a 16.68% increase from the previous year. Despite this surge, the self-sufficiency rate slightly declined to 98.81%. Notably, caprolactam’s application is highly concentrated, with about 98% of the output being utilized for the production of nylon 6.
As a key raw material for nylon 6, caprolactam is primarily produced through the benzene or toluene process, with the benzene method dominating in China. This production process encompasses three core stages: cyclohexanone preparation, cyclohexanone oxime preparation, and caprolactam production, employing either the ammonia oximation process (HAO) or the hydroxylamine phosphate process (HPO). With the continuous expansion of production capacity, China’s caprolactam supply and demand landscape has undergone significant transformations.
In response to the growing downstream demand, multiple new or expanded caprolactam production facilities have come online in China since 2020. Companies such as Henan Pingmei Shenma Nylon Technology, Fujian Yongrong Technology, and Fujian Shenyuan New Materials have increased their caprolactam production capabilities. By the end of 2023, China’s total caprolactam capacity had reached 6.79 million tons per year. Fujian Shenyuan New Materials topped the list with a capacity of 800,000 tons per year, followed closely by Sinopec Hunan Petrochemical and Fujian Yongrong Technology.
In terms of geographical distribution, the eastern, northern, and southern regions of China have emerged as the main bases for caprolactam production, accounting for 83.51% of the total capacity. Shandong, Fujian, and Hebei provinces, in particular, have a combined capacity share of 55.67%. Moreover, most producers have achieved synergistic development across the upstream and downstream chains, further enhancing the overall competitiveness of the industry.
On the import-export front, China’s caprolactam imports saw a significant increase of 79.65% in 2023, reaching 153,755.05 tons, while exports also rose by 97.37% to 94,358.76 tons. Russia was the largest import source, with Jiangsu province being the top importing region. In the export market, Taiwan, South Korea, and India were the main destinations, with Shanghai serving as the largest exporting city.
Price-wise, the Chinese caprolactam market remained relatively stable in 2023, with an average annual price of 12,633 yuan per ton, slightly lower than in 2022. However, the first four months of 2024 saw a downward trend in prices, although future fluctuations are expected to be moderate.
Looking ahead, while China’s caprolactam production capacity is projected to continue growing to about 8 million tons per year by 2028, consumption is forecasted to reach only around 6 million tons, highlighting an increasing issue of overcapacity. Therefore, the industry urgently needs to expand rationally, plan strategically, and actively explore new production technologies and high-quality product development to reduce homogeneous competition. Simultaneously, strengthening upstream-downstream integration, improving product quality, and expanding exports are crucial to effectively address the overcapacity challenge.