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Market Status and Development Trend of Functional Silane Industry in 2018

Functional silane is a small silicone molecule with a main chain of -Si-O-C-structure. It is a very important and widely used additive. It is often used in surface modification of inorganic substances, modification of thermosetting resin-based composites, modification of thermoplastic resin-based composites, rubber, coatings, adhesives and sealants.

According to relevant statistics, the per capita GDP level is basically proportional to the per capita silicone consumption, and the growth of silicone demand in low-income countries has greater elasticity to income growth. In recent years, with the rapid economic growth, China has become the world's largest producer, consumer and exporter of functional silane.

According to SAGSI data, the production capacity of functional silane in China increased rapidly from 188,000 tons per year to 398,000 tons per year in 2010-2018, and the output also increased from 95,000 tons to 257,000 tons. However, due to the rapid expansion of production capacity, under the influence of supply-side reform and environmental supervision, small and medium-sized enterprises were shut down in a large area, and the overall start-up rate of the industry was not high until 2018.

Functional silane is mainly used in rubber processing, composite materials, plastic processing, sealants, adhesives, coatings, metal surface treatment and building waterproofing, among which rubber processing is the main application market. In 2018, functional silane consumption in rubber processing reached 58,000 tons, accounting for 33.9% of the total consumption, of which tyre consumption reached 56,600 tons, and other rubber products. Consumption is about 0.14 million tons.

On the export side, in 2018, the export volume of functional silane in China reached 908,000 tons, with an export value of 352 million US dollars. The main export products are sulfur-containing silane, cross-linking agent, amino, vinyl, epoxy, acryloxy, etc. The main export markets are the United States, India, Korea, Japan and other countries. Among the export enterprises, Jingzhou Jianghan Fine Chemical Co., Ltd. and Hubei New Blue Sky New Materials Co., Ltd. rank the top two in the export volume of functional silane in China, followed by Jiangxi Hongbai, Shandong Silicon Section and Hangzhou Silicon Treasure.

Production and sales will continue to grow

In terms of market trend, with the growth and maturity of emerging market demand such as new energy vehicles, composite materials and surface treatment, and the per capita consumption of functional silane in China is still lower than that in developed countries, the future production and sales of functional silane will continue to grow and the growth rate will remain stable. By 2023, the total production capacity of functional silane will reach 564,000 tons, the total output will reach 389,000 tons, and the consumption will reach 278,000 tons in the same period.

In terms of product trend, after years of development, the varieties, quality and output of functional silane in China have been greatly developed. With the rapid development of new industries such as solar energy, lithium batteries, LED lamps, 5G network, the demand for sealants and adhesives is also increasing. For example, in room temperature vulcanized silicone rubber, the demand for neutral rubber is growing rapidly, and the deketone oxime rubber has become the mainstream of the market. The acid type rubber is shrinking, and the development of neutral rubber will be the general trend in the future. In addition, the development of conventional functional silanes in China is very rapid, but the gap between the development of high-end functional silanes and foreign countries is still obvious. In the future, functional silanes in China will develop in the direction of high-end, specialization and new-type.

In terms of competition trend, in recent years, the functional silane industry has experienced obvious integration after explosive growth. Some small enterprises have withdrawn one after another, and the trend of concentration of production capacity to large enterprises is more obvious. At the same time, under the background of the continuous tightening of safety and environmental protection requirements and the continuous promotion of supply-side reform, silane enterprises will develop towards the trend of large-scale, integration and regionalization.