Industry Overview - MDI, or methylene diphenyl diisocyanate, is a high-performance chemical material known for its excellent heat resistance, chemical stability, and high strength [2][5] - The MDI industry in China began in the 1960s but was heavily reliant on imports due to technological limitations [2][12] - Since the 21st century, with investments from foreign companies like Dow and the production ramp-up by Wanhua Chemical, China's MDI capacity has rapidly expanded, surpassing 1 million tons in 2008 and 3 million tons in 2016 [2][12] - By 2024, China's MDI capacity is projected to grow from 3.38 million tons in 2018 to 4.8 million tons, accounting for over 40% of global MDI capacity [2][12] Global Market - The global MDI capacity is expected to increase from 8.38 million tons in 2018 to 11.52 million tons by 2024, with a compound annual growth rate (CAGR) of 5.44% [7] - The MDI industry is characterized by high technical barriers and capital intensity, leading to an oligopolistic market structure, with the top five companies controlling 91.77% of global capacity by 2024 [9][10] Domestic Market - China's MDI market is dominated by Wanhua Chemical, which holds a 64.85% share of the domestic capacity, significantly higher than other players like BASF and Covestro [12][20] - The MDI industry in China is experiencing growth due to increasing demand from the construction sector, with the market size projected to rise from 33.72 billion yuan in 2019 to 48.23 billion yuan in 2024 [14] Key Companies - Wanhua Chemical, established in 1998, is a leading global chemical materials company with an MDI capacity of 3.8 million tons per year as of 2024, and plans to expand to 4.5 million tons by 2026 [16] - BASF, a major player in the MDI market, has a global capacity of 1.89 million tons as of 2024, leveraging advanced technologies and facilities [18] Development Trends - The MDI industry is witnessing continuous capacity expansion and increasing market concentration, with Wanhua Chemical and other companies planning to add 1.49 million tons of new capacity by 2025 [20] - The industry is also shifting towards green transformation and high-end upgrades, with companies like Wanhua and BASF achieving sustainability certifications and developing high-performance products [21] - Emerging markets, particularly in the Asia-Pacific region, are driving demand growth, with China's dual carbon policy enhancing the need for MDI in construction and logistics [22]