The Urethane Blog

Asian MDI Overview

2016 H1 MDI Demand Up and Down in Southeast Asia
2016-07-06    [Source:PUdaily]

PUdaily, Shanghai—Southeast Asia region (or ASEAN ) mainly imports MDI from China, Japan and South Korea with its percentage in each country’s export quantity respectively at 23.1%, 15.6% and 9.5% in 2015 thanks to free trade agreement (FTA) between ASEAN and the three countries that allows local buyers pay very low or zero import duty, according to PUdaily. 

Japanese polymeric MDI imports to Southeat Asia are levied import tax of 1.6%, which will be reduced to zero since 2017.

China, Japan and South Korea based MDI suppliers provide stable and sustained MDI cargoes at competitive prices and have enjoyed good reputation in Southeast Asia.

Import quantity could be regarded as consumption in a degree as there is no MDI manufacturing facility in this region and all demands are covered by imports, according to consultant at PUdaily.

In the first half of this year, Vietnam, the largest MDI market in Southeast Asia continues expanding rapidly and robustly and Indonesia is on track for stable growth in line with recovering economy with new president in 2014 whilst Thailand remains in downward pathway on recession in appliance despite uptrend in construction activity, according to market sources. More details please see below graph: (import quantity refers to total from northeast Asia)



The Vietnam market has increased its polymeric MDI imports to 17,284 tons from Jan. to May, in 2016, nearly up by 50% year on year. The polymeric MDI in local market are mainly applied to sectors like household appliance and panel. As for pure MDI, the import growth during the same period is relatively lower with 7,327 tons, up by 7.6% year on year. The pure MDI are mainly used in shoe soles and spandex and about 90% of imports come from South Korea and China.


The local market has imported 17,639 tons of polymeric MDI during the first five months in 2016, down by 5.9% year on year due to the business decline in household appliance and auto industries despite the uptrend of demands from downstream industries including construction and panel. As for pure MDI imports, it totals 2,061 tons and mostly are from Japan while some comes from China. The pure MDI in the local market is mainly applied to sectors like spandex, shoe soles and pre-polymer.


The local market has increased pure MDI imports to 11,591 tons during the first five months in 2016, up by 24.1% year on year while the polymeric MDI imports decrease to 925 tons, down by 43.2%. Market sources said that pure MDI is more popular to be used and demands for polymeric MDI are limited and tend to gradually be decreasing. COIM is one of the leading pure MDI consumers in the country and it produces TPU, shoe soles, pre-polymer and so on.


The local market’s MDI consumption has also turned to growth path with the country’s economic recovery since 2014. During the first five months in 2016, the market has increased polymeric MDI imports by 22.8% year on year, totaling 10,331 tons, which is still below market expectations although demands from household appliance and panel have increased when compared to that in 2015. As for pure MDI, the weak demands in local downstream market make the imports total around 800 tons in the first five months, down by 12.2% year on year.


The country’s fiscal consolidation actions have dragged the domestic demands and thusly MDI consumption in local market have decreased. MDI imports are falling 0.1% from last year. The country has imported 6,799 tons of polymeric MDI, down by 1.1% year on year and 850 tons of pure MDI, up by 8.1% year on year during the first five months in 2016. Besides, MDI consumption is mainly driven by construction since there are few refrigerator factories locally and new building projects are limited. Moreover, Malaysia exports a bulk of PU systems to Vietnam and other countries.

Other countries:

Supported by increasingly expandingle building industries, MDI consumption in the Philippines shows stable uptrend. PU industries in Cambodia and Burma currently are still at an early stage of development and have limited MDI consumption.

In Southeast Asia, Vietnam is the largest MDI market followed by Thailand, Singapore and Indonesia while Thailand is the largest polymeric MDI market and Singapore the largest pure MDI market. PUdaily estimates that MDI consumption in Thailand and Malaysia decline slightly but that in Vietnam, Indonesia, Singapore and the Philippines increase stably in the H1 of this year.

Some MDI manufacturers are heard shipping cargoes from Europe and America vying for market share but it’s not competitive in view of higher freight and tax. besides, the quantity is in tandem with northeast Asia.

Editor: Karen Lau


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