Development requirements of chemical industry

Porter's five forces

(1) Bargaining power of suppliers

Oil and gas is the upstream enterprise of the chemical industry, and the raw materials of the chemical industry are mainly oil and gas, and oil and gas are scarce resources. At present, China's domestic oil and natural gas supply is short, and it needs a large amount of imported crude oil and natural gas every year, and the import dependence is high, so the energy producing countries have a strong price control ability of oil and natural gas, and the upstream suppliers of the chemical industry have a relatively strong bargaining power.

(2) The bargaining power of downstream customers is enhanced

The downstream enterprises of the chemical industry mainly include the automobile industry, the textile industry, agriculture and residents' daily life chemicals. Due to the relatively mature technology of the chemical industry, the difference between the products of different enterprises is very small, the product market competition is very fierce, in 2012 at home and abroad economic downturn situation, domestic and foreign demand for chemical industry products have declined to varying degrees. Therefore, the selectivity of downstream customers for chemical enterprise products increases, and their bargaining power is correspondingly enhanced.

(3) The threat of potential entrants to the industry

The chemical industry has low barriers to entry, and small enterprises account for the majority of the industry characteristics, which determines that there are more equal competitors in the chemical industry and a wide range of competition participants; The chemical industry technology is relatively mature, the market is also relatively mature, the product demand growth is slow, competitors are easy to use price reduction and other means of promotion, the conversion cost of users is very low. Therefore, the threat of potential entrants in the industry is greater.

(4) The threat of substitutes in the chemical industry

On the whole, the possibility of chemical raw materials and chemical products manufacturing products being replaced by other industry products is very small, the main replacement is the replacement of different process technology routes in the production of the same product. For example, in the production process of PVC, there have always been two production technologies: calcium carbide method and ethylene method. The Middle East is rich in oil and gas resources, which are mainly produced by ethylene process.

(5) Fierce competition in the industry

According to Bain industrial concentration classification standards, China's chemical raw materials and chemical products manufacturing industry as a whole is a completely competitive industry. However, the competitive situation in a single fine molecule industry may be different. China's top ten enterprises in PVC, soda ash, dye and tire industries accounted for 52%, 60%, 80% and 70% of total output respectively. The above subdivided industries are already oligopolistic competitive industries.

(1) Sinopec [600028.SH,http://0386.HK]] is a joint-stock enterprise with integration of upper, middle and lower reaches, prominent main industries of petroleum and petrochemical industry, complete sales network and listing at home and abroad. The company is one of the largest integrated energy and chemical companies in China, mainly engaged in oil and gas exploration and development, pipeline transportation and sales; Petroleum refining, petrochemical, coal chemical, chemical fiber and other chemical production and product sales, storage and transportation; Import and export of petroleum, natural gas, petroleum products, petrochemical and other chemical products and other commodities and technologies, and import and export agent business; Research, development and application of technology and information. Sinopec is a big oil and gas producer in China; Refining capacity ranked first in China; It has a complete sales network of refined oil products in China and is the largest supplier of refined oil products in China. Ethylene production capacity ranks first in China, and a relatively complete chemical product marketing network has been built.

(2) Wanhua Chemical [600309.SH] business covers MDI, TDI, polyether polyols and other polyurethane industrial cluster, acrylic and ester, propylene oxide and other petrochemical industrial cluster, water-based PUD, PA emulsion, TPU, ADI series and other functional chemicals and materials industrial cluster. The industries we serve mainly include: home life, sports and leisure, automobile transportation, construction industry and electronic appliances. In the field of production, the domestic production bases in Yantai, Ningbo, Zhuhai and other places operate stably. In the field of research and development, R&D centers in Yantai, Beijing, Foshan, Shanghai and other places have gradually taken shape, and the North American technology center has been officially put into use in Houston. In addition, Wanhua Chemical has established companies and offices in Europe, the United States, Japan and other countries and regions.