[Industry Reports]：MMA (methyl methacrylate) industry value analysis, factors affecting cost under different production processes

MMA is called methyl methacrylate, which is an important raw material for producing polymethyl methacrylate (PMMA) and is also commonly known as acrylic. With the adjustment and development of PMMA industry, the development of MMA industry chain has been pushed back. According to the investigation, there are three mainstream production processes of MMA at present, which are acetone cyanohydrin method (ACH method), ethylene carbonylation method and isobutylene oxidation method (C4 method). At present, among Chinese production enterprises, the main methods are ACH and C4, while the ethylene carbonylation method has no industrial production unit.

Our research on MMA value chain analyzes the above three production processes and the price halo of main downstream PMMA respectively.

in the process of MMA production by ACH method, the main raw materials are acetone and hydrocyanic acid, of which hydrocyanic acid is produced through acrylic nitrile by-product and auxiliary materials methanol. Therefore, acetone is generally used in the industry, acrylic nitrile and methanol are the raw materials for cost calculation. In the calculation of unit consumption of 0.69 tons of acetone, 0,32 tons acrylic nitrile and 0.35 tons of methanol, acetone costs account for the largest proportion in the cost composition of MMA by ACH method, followed by hydrocyanic acid by acrylic nitrile, the proportion of methanol is the smallest.

According to the price correlation test of acetone, methanol and acrylic nitrile in the past 3 years, it is found that the correlation between ACH MMA and acetone is about 19%, and the correlation with methanol is about 57%, according to the correlation of acrylonitrile, it is about 18%. It can be seen that there is a gap between this and the proportion of cost in MMA. The high proportion of acetone to MMA cost cannot be reflected in its price fluctuation to the price fluctuation of ACH MMA, however, the price fluctuation of methanol has a greater impact on MMA price than acetone.

However, the cost of methanol accounts for only about 7%, and the cost of acetone accounts for about 26%. For the value chain research of MMA, it depends more on the cost changes of acetone.

Overall, the MMA value chain of ACH method mainly comes from the cost fluctuation of acetone and methanol, of which acetone has the greatest influence on MMA value.

for the value chain of C4 MMA, the raw materials are isobutene and methanol, among which Isobutene is a high-purity isobutene product, which comes from MTBE cracking production. Methanol is an industrial methanol product, which comes from coal production.

According to the cost composition of MMA by C4 method, the variable cost isobutene unit consumption is 0.82 and methanol is 0.35. With the progress of production technology, the unit consumption has been reduced to 0.8 in the industry at present, to some extent, the cost of MMA by C4 method is reduced. The rest are fixed costs, such as water and electricity costs, financial costs, sewage treatment costs and others.

Here, the proportion of high purity isobutylene in MMA cost is about 58%, and the proportion of methanol in MMA cost is about 6%. It can be seen that Isobutene is the largest variable cost in C4 MMA, and the price fluctuation of Isobutene has a great influence on the cost of C4 MMA.

For the value chain impact of high purity isobutylene, it is traced back to the price fluctuation of MTBE, the consumption unit consumption of MTBE is 1.57, and the cost composition of high purity isobutylene exceeds 80%. The cost of MTBE comes from methanol and C4 before ether, in which the composition of C4 before ether can be linked with the value chain of raw materials.

In addition, what needs special explanation is that at present, high purity isobutene can be dehydrated by tert-butyl alcohol. Some enterprises will use tert-butyl alcohol as the basis for MMA cost calculation, and its unit consumption of tert-butyl alcohol is 1.52. According to the calculation of 6200 yuan/ton of tert-butyl alcohol, the proportion of tert-butyl alcohol to MMA cost is about 70%, which is greater than isobutene.

In other words, if the price linkage of tert-butyl alcohol is adopted and the value chain of C4 MMA fluctuates, the influence right of tert-butyl alcohol is more important than isobutylene.

To sum up, in C4 MMA, the influence weight on value fluctuation is ranked from high to low: tert-butyl alcohol, isobutylene, MTBE, methanol and crude oil.

ethylene carbonylation MMA currently has no case of industrial production in China, so it is impossible to speculate the influence of value fluctuation through actual industrial production. However, according to the ethylene unit consumption in the carbonylation of ethylene, ethylene constitutes more than 85% of the MMA cost of this process, which is the main cost impact.

PMMA, as the main downstream product of MMA, consumes more than 70% of MMA every year.

Figure 2 China PMMA industry chain flow chart

according to the value chain composition of PMMA, the unit consumption of MMA is 0.93,MMA is calculated according to 13400 yuan/ton, PMMA is calculated according to 15800 yuan/ton, the variable cost of MMA in PMMA accounts for about 79%, which is relatively high.

In other words, the price fluctuation of MMA has a great influence on the value fluctuation of PMMA, which is a strong correlation. According to the correlation of price fluctuation in the past 3 years, the correlation between the two exceeds 82%, which is the influence of strong correlation. Therefore, the price fluctuation of MMA will probably cause the price fluctuation of PMMA in the same direction.