Domestic POE Breakthrough: Acceleration of Domestic POE Progress [SMM Analysis]

In 1991, ExxonMobil first used Exxpol technology to produce polyolefin elastomers (POE), naming the product EXACT. In 1993, Dow Chemical launched ENGAGE POE. Subsequently, Mitsui Chemicals, LG Chem, and SK-SABIC introduced their respective POE products in 2003, 2009, and 2014. In 2013, Borealis acquired ExxonMobil's plant in the Netherlands, gaining POE production capacity. By mid-2023, the global POE capacity was approximately 2 million mt, with ethylene elastomer capacity accounting for about 1.58 million mt. Due to the shared production lines of POE and other polyethylene products, the actual capacity is lower than the nominal capacity, with Dow Chemical holding a 48% market share.

By mid-2023, China's POE products were entirely reliant on imports, primarily sourced from the US (Dow Chemical and ExxonMobil, 53%), South Korea (LG Chem and SK-SABIC, 37%), Japan (Mitsui Chemicals, 8%), and the Netherlands (Borealis, 2%). According to data from China's General Administration of Customs, China's POE imports steadily increased from 224,400 mt in 2017 to 859,200 mt in 2023, with a compound annual growth rate of 25.1%. Meanwhile, the import value rose from 2.662 billion yuan in 2017 to 15.895 billion yuan in 2023, with a compound annual growth rate of 34.7%.

On the morning of April 13, 2024, BeoYi successfully achieved the loading and sales of domestically industrialized PV-grade POE, marking the first batch sales of an industrialized POE unit in China. In July of the same year, Wanhua Chemical's 200,000 mt/year POE unit achieved industrial production. Plans indicate that by 2030, the capacity is expected to increase to 4.1 million mt.

In 2024, China's POE imports are expected to reach 865,000 mt, including 365,400 mt of PV-grade POE imports, while domestic POE production is projected to be 28,000 mt, reflecting a high import dependency of 93%. Looking ahead, from 2024 to 2030, the annual growth rate of PV-grade POE is likely to reach 90%, with a rapid growth period in production from 2024 to 2026. By 2025, as domestic POE manufacturers mature and new capacities come online, domestic production is expected to exceed 100,000 mt. However, achieving stable production of new capacities will still require time, and the limitation of raw materials such as α-olefins needed for high-end grades remains a significant challenge.