Core Insights - Hydrogenated resins, known for their enhanced chemical stability, heat resistance, and reduced odor, are increasingly used in high-end adhesives, specialty coatings, and electronic packaging [1][2] - By the end of 2024, China's hydrogenated resin production capacity is expected to reach 578,000 tons per year, accounting for over 50% of global capacity, with production increasing from 220,000 tons in 2020 to 420,000 tons [1][9] - The industry is projected to grow to approximately 4.83 billion yuan in 2024 and is expected to reach 5.27 billion yuan in 2025, driven by demand from sectors like new energy vehicles [1][11] Overview of the Hydrogenated Resin Industry - Hydrogenated resins are modified resin materials produced through hydrogenation of petroleum resins, resulting in improved chemical stability and reduced reactivity [2][3] - The production process involves multiple steps, including pre-treatment, polymerization, and hydrogenation refining, typically conducted in high-pressure fixed-bed reactors [3] Current Development Status of China's Hydrogenated Resin Industry - China's hydrogenated resin industry is experiencing significant growth, with production capacity expected to reach 578,000 tons per year by the end of 2024, driven by enhanced raw material supply and downstream demand [8][9] - The production volume is anticipated to double from 220,000 tons in 2020 to 420,000 tons in 2024, with a notable increase in exports due to supply constraints in Europe [8][9] Market Size and Forecast - The market size for hydrogenated resins in China is projected to grow from approximately 4.83 billion yuan in 2024 to 5.27 billion yuan in 2025, reflecting a steady growth trend [11] Industry Chain of China's Hydrogenated Resin Industry - The industry has established a complete value chain, from upstream raw material supply to downstream applications in adhesives, coatings, and high-performance rubber products [12] Competitive Landscape of China's Hydrogenated Resin Industry - The industry is characterized by competition between international giants and domestic leaders, with companies like ExxonMobil and Eastman holding significant market shares in high-end segments [13] - Domestic companies such as Henghe Materials and Puyang Shenghong Chemical are rapidly expanding their production capacity, indicating an intensifying competitive environment [13] Development Trends in China's Hydrogenated Resin Industry - The industry is moving towards high-end, green, and globalized development, with a focus on technological innovation and the expansion of applications in new energy vehicles and other emerging markets [15][16] - The shift towards lower VOC and higher bio-based content materials is driven by stringent environmental regulations and growing demand for sustainable products [16] - The competitive landscape is expected to evolve, with leading companies consolidating their market positions through mergers, capacity integration, and strategic collaborations [17]

Core Viewpoint - The carbon five and carbon nine petroleum resin industry in China is facing unprecedented challenges, necessitating a shift towards "anti-involution" and transformation due to overcapacity and price competition. Supply and Demand - The rapid development of the domestic ethylene industry has provided ample raw materials, prompting companies to continuously expand production capacity. However, external demand has contracted due to global economic downturns and rising trade protectionism, leading to a situation where increased production does not translate into higher revenues. By 2025, total industry capacity is expected to exceed 2.6 million tons, while actual production is projected to be less than 1.5 million tons, resulting in a capacity utilization rate of less than 60% [1] - The industry structure is severely homogenized, with over 67% of carbon nine petroleum resins being standard grades, while high-value specialty resins remain limited. This lack of differentiation forces companies to rely on price competition for survival. The market price of general-grade hydrogenated petroleum resins has fluctuated dramatically, dropping from approximately 15,000 yuan/ton at its peak to below 8,500 yuan/ton by the second quarter of 2025, nearing the production cost line of most companies (8,000-9,000 yuan/ton), resulting in negative average profit margins [1] Market Competition - The change in market concentration has intensified price competition, with the top five domestic companies increasing their capacity share from 38% in 2019 to 45% in 2024. Leading companies are engaging in a vicious cycle of "capacity expansion - price decline - expansion to break even" through marginal contribution pricing methods [2] - The rise of global trade protectionism has led to frequent anti-dumping lawsuits against Chinese carbon five and carbon nine petroleum resin products, with tariffs exceeding 30% imposed by the US, South Korea, the EU, India, and Brazil, significantly weakening the international competitiveness of domestic companies. Additionally, global demand shrinkage is constraining export growth, with the global plastic market growth rate expected to drop to 5% and the coatings market growth rate slowing to 5.5% by 2025. Orders for plastic products in Southeast Asia have decreased by 15% year-on-year [2] Recommendations for Transformation - The carbon five and carbon nine petroleum resin industry should focus on high-end product development, as there is still a supply gap for high-end products like hydrogenated resins. Domestic companies should prioritize R&D for specialty resins that meet the requirements of high-end fields such as food packaging and medical devices to avoid homogenized competition [3] - Strengthening technological innovation is essential, with increased R&D investment to overcome core technical bottlenecks in hydrogenation processes and catalyst efficiency. Collaboration between industry, academia, and research, along with digital transformation, are effective ways to enhance competitiveness [3] - Integrating the industrial chain by extending upstream to improve raw material self-sufficiency and expanding downstream to develop end-use products is crucial. Additionally, recycling and reusing waste resins aligns with environmental trends and can lower raw material costs [3] - Establishing international production capacity through overseas factories or acquisitions can help avoid anti-dumping restrictions. Developing emerging markets along the "Belt and Road" initiative can diversify market risks [3]