01     General situation

MDI (diphenylmethane diisocyanic acid) is a polyurethane material synthesized by isocyanate, polyol and its auxiliary agent, which is used in household appliances, buildings, transportation and other scenes.

MDI is considered as one of the bulk products with the highest comprehensive barriers in the chemical industry. The synthesis process of isocyanate is long, including nitration reaction, reduction reaction and acidification reaction.

There are two main production processes of MDI: phosgenation and non-phosgenation. Phosgene process is the mainstream technology for industrial production of isocyanates at present, and it is also the only method that can achieve large-scale production of isocyanates. However, phosgene is highly toxic, and the reaction needs to be carried out under strong acid conditions, which requires high equipment and technology.

02     sort

MDI is generally divided into three categories: polymer MDI, pure MDI and modified MDI:

Polymerized MDI is a raw material for the production of polyurethane hard foam and semi-hard foam, and its finished products are widely used in refrigerator, thermal insulation materials, automotive trim parts and other industries.

Pure MDI is mainly used in the manufacture of various kinds of polyurethane elastomers, mostly used in the production of thermoplastic polyurethane elastomers, spandex, PU leather slurry, shoe adhesives, and also used in microporous elastomer materials, such as soles, solid tires, self-crusting foam, car bumpers, interior trim parts, and the manufacture of cast polyurethane elastomers.

As a derivative of MDI series products, modified MDI is a technical extension of pure MDI and polymerized MDI products commonly used in the market at present, and can provide unique use and processing properties according to the difference in product structure design and synthesis process, so as to be widely used in soft bubbles, elastomers, coatings, adhesives and other fields.

03     Upstream and downstream of the industrial chain

Upstream for oil, natural gas, iron ore and other resources;

The middle reaches are chemicals between raw materials and downstream final products, representing WH Chemical, WX petrochemical, etc.

The downstream is the final chemical products, such as plastics, rubber, pesticides, fertilizers, etc., representing the company JF Technology, LL tires, RL chemicals, HR Hengsheng, etc.

04    Demand analysis and market differences

Polyurethane produced by MDI has a wide range of downstream applications, mainly used in the construction industry, home industry, household appliances, transportation industry, footwear industry, etc. Therefore, MDI consumption is highly correlated with the degree of global economic prosperity.

From a global perspective, the total consumption structure of polymerized MDI in 2021 is mainly: 49% for the construction industry, 21% for home appliances, 17% for adhesives, and 11% for automobiles.

From the domestic perspective, the proportion of polymerized MDI consumption structure in 2021 is mainly: 40% for white goods, 28% for the construction industry, 16% for adhesives, and 7% for automobiles.

05      Competitive pattern

The supply side of MDI presents the competition pattern of oligopoly. There are eight major MDI manufacturers in the world, and the top three manufacturers by capacity are WH Chemical, BASF and Covestro, with the combined capacity of the three enterprises accounting for more than 60% of the world’s total production capacity. Among them, WH Chemical is the leading enterprise in China’s MDI industry and the world’s largest MDI manufacturing enterprise.