Melamine is a kind of organic chemical products with urea as the main raw material, mainly used in board, dense amine powder and impregnated paper, can also be used in the production of paint, resin, flame retardant materials, can also be used in textile anti-folding, anti-shrinkage treatment agent, synthetic fireproof laminate bonding, waterproofing agent or hardening agent.
China has become the world's largest melamine production base. However, due to the double impact of overcapacity and insufficient downstream demand, since the beginning of 2018, the market price of melamine has continued to decline, and the capacity operating rate is obviously insufficient. In 2021, the output of domestic melamine industry reached about 1.42 million tons, an increase of about 250,000 tons from 2020, while the demand was less than 1 million tons. China's melamine production capacity to meet the domestic market demand, but also exported to overseas markets.
According to the statistical data of China Customs, the quantity and amount of China's export of melamine fluctuated from 2014 to 2021, and gradually increased from 2015 to 2018. However, due to the COVID-19 epidemic, China's export quantity and amount of melamine fluctuated. From 2018 to 2020, the quantity and value of China's export of melamine showed a downward trend, and it did not pick up until 2021. In 2020, China's export of melamine was 304,300 tons, and in 2021, it was 505,500 tons, with a year-on-year increase of 66.12%. China's imports of melamine from 2014 to 2021 were small and the change was not particularly obvious.
Melamine is currently the largest downstream demand, mainly furniture plate manufacturing enterprises. After the Spring Festival in 2021, melamine saw a rapid rise. At that time, the epidemic was severe overseas, and consumers in affected countries had been staying at home for a long time, which led to a surge in the demand for sheet furniture, thus amplifies the demand for melamine.
The international market demand will keep growing
As a chemical raw material, melamine has a wide range of applications, and its downstream applications continue to expand. At the beginning of 2022, driven by domestic demand and export, the industry boom of melamine in China has increased, and the market price has risen significantly. China is a big producer of urea, and the supply of melamine raw materials is sufficient, which is good for the expansion of melamine industry. However, as the current melamine market is still in a state of excess capacity, the new capacity of melamine industry will be limited in the future.
Looking ahead to 2022, the world economy will gradually recover and develop better under the condition of normalizing the epidemic, and the demand for melamine in the international market is expected to maintain a steady growth. The supply of melamine in the international market is still uncertain, and Chinese supplies remain an important source of imports in the international market. At the same time, due to the cost support and increasing demand in European and Indian markets, it is expected that China's export volume will continue to grow.