The commissioning of new facilities accelerates EVA capacity expansion, making it difficult to sustain the price increase trend

On October 25, the 200,000 mt/year tubular EVA facility of Sierbang was put into production, pushing the annual EVA market capacity to 2.9 million mt. Currently, the facility is conducting trial production of LDPE and is expected to switch to EVA production on November 20. With the rapid expansion of EVA market capacity, a supply surplus may occur in 2025, and film companies are expected to gradually gain more power and influence in selection and pricing.

Supply and demand are the core factors determining market bargaining power

Market bargaining power refers to the ability to influence prices and conditions in transactions, which is mainly affected by supply and demand relationships. When one party has an advantage in supply or demand, they often gain greater influence and control in negotiations. Therefore, understanding market supply and demand dynamics is crucial. In a supply surplus situation, buyers have stronger bargaining power; whereas, when demand exceeds supply, sellers hold the advantage.

In 2023, PV-grade EVA production surged, production barriers weakened, and prices continued to decline

In 2021, domestic EVA facilities were gradually put into operation, with capacity up 76% YoY. Petrochemical plants actively explored production technologies, and in 2022, the total EVA production reached 1.68 million mt, up 66% YoY.

2023 became a key year for accelerating the localisation of PV-grade EVA, with production reaching 815,800 mt, up 101.42% YoY. PV production technology continuously improved, and production barriers gradually lowered. From 2023 to 2024, with the successive commissioning of new capacities from Gulei (300,000 mt) and Baofeng (250,000 mt), PV-grade EVA production is expected to continue growing. Due to the high prices and long transportation cycles of overseas EVA, its import volume gradually decreased, rapidly reducing the dependence on EVA imports. By the end of 2024, the total domestic production of PV-grade EVA is expected to reach 1.1 million mt.

From 2024 to 2026, EVA capacity will rapidly expand, and film companies' bargaining power may gradually strengthen due to supply surplus

In 2024, the annual EVA market capacity will increase to 2.9 million mt. On October 25, the 200,000 mt/year tubular EVA facility of Sierbang was put into production. Currently, the facility is conducting trial production of LDPE and plans to switch to EVA production on November 20.

Currently, PV-grade EVA inventories are low at all stages, and film manufacturers are in a procurement cycle. Short-term prices are expected to rise further. With the weakening of module scheduled production, insufficient demand support for film and resins, and further increases in supply, long-term prices may quickly decline.

In 2025, new EVA capacity is expected to reach 1.14 million mt, plus the 200,000 mt facility commissioned in 2024 switching to EVA, resulting in a capacity increase of 49.63%. The production barriers for PV-grade EVA will be further broken, with capacity and production increasing simultaneously.

In 2025, new EVA capacity is expected to reach 1.14 million mt, plus the 200,000 mt facility commissioned by Sierbang this year switching to EVA, resulting in a total increase of 49.63%. With the breakthrough in production technology barriers, capacity and production will increase simultaneously.