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As global resource prices continue to rise, the production of melamine—especially those relying on urea as a raw material—has become increasingly concentrated. With the expanding applications of eco-friendly downstream products such as melamine-modified urea-formaldehyde resins, international demand has steadily grown and is now extending further into new markets. Industry experts at the recent "Second China Melamine and Downstream Industrial Development Promotion Summit" highlighted that the characteristics of global melamine production bases, including their scale and industrialization, are becoming more pronounced, signaling a shift toward a more intensive and consolidated industry.
The concentration of production has been driven by rising costs of basic materials like crude oil and natural gas. Several major producers in the U.S., Japan, and South Korea have either halted operations or significantly cut back production. For example, Japanese company Mitsui and U.S.-based Cyanamide have both reduced output by over 50%, with Mitsui exiting the melamine market entirely in early 2023.
While some companies scale back, leading global players are actively seeking new strategic locations. Dutch firm DSM, the world's largest melamine producer, announced plans to restructure its European operations over the next one to two years, focusing on joint ventures and sales partnerships to expand influence elsewhere. In 2008, DSM confirmed its strategic direction by entering into an agreement with Shanxi Fengxi Fertilizer for melamine operations. A joint venture was officially launched in February 2024, while Lurgi’s 40,000-ton-per-year project in Russia is set to start production in June. Meanwhile, AMI’s 80,000-ton facility in the Middle East is under construction and expected to begin operations in 2009.
Wu Haibo, Deputy General Manager of Sichuan Meiqing Cyanamide Co., Ltd., noted that future global melamine production hubs will likely be located in China, the Middle East, and the Black Sea region. As the industry evolves, downstream development is becoming a key strategy for growth. Li Jian from the Beijing Triazine Xingda Chemical Research Institute emphasized the importance of diversifying product structures and consumption patterns.
In the U.S., the melamine industry has maintained strong growth in the coatings sector, supported by traditional products and innovative surface technologies. The large-scale, integrated production model ensures consistent quality and the ability to adopt new technologies. Companies like Cytec have expanded their product lines based on melamine, offering over 50 downstream products ranging from coatings to adhesives. This vertical integration helps maintain long-term dominance in key application areas.
In Western Europe, companies like BASF, Linz, and DSM not only produce melamine but also develop downstream products. BASF converts its 70,000-ton annual melamine output into various end-use products, while Linz achieves a 50% internal conversion rate. These leaders provide critical technical support for innovation and expansion into new markets. For instance, BAURA offers over 30 types of melamine-based wood adhesives and impregnation resins, ensuring competitive advantage through product variety and quality.
With energy prices continuing to climb in 2024, some melamine plants may face further production cuts due to high operating costs. However, strong demand in Europe, North America, and Southeast Asia suggests a growing gap between supply and demand. Yan Haibo stated that this situation presents a positive outlook for the industry, with increased international demand expected to persist until new large-scale facilities come online.
The versatility of melamine—used in the production of formaldehyde resins, flame retardants, water reducers, and even pharmaceuticals—has contributed to its widespread use across industries such as wood processing, plastics, papermaking, textiles, and leather. Its non-toxic properties, heat resistance, and chemical stability make it a valuable raw material.
According to Zhou Chunguo, Technical Service Manager at DSM (China) Co., Ltd., the development of new applications will further boost melamine’s market potential. Looking ahead, the global melamine industry is expected to maintain its upward trend, with rapid growth accelerating the pace of industrial consolidation.