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Affected by various factors such as high energy costs, taxes related to climate change, rising raw material prices, and changing tariffs. The European chemical industry is facing severe difficulties. At the 59th annual meeting of the European Petrochemical Association (EPCA) held recently in Berlin, industry officials said that the issue of widespread capacity shutdowns in Europe’s chemical industry is quite serious; not only is the olefins sector affected, but this trend of production cuts is spreading throughout the entire industry chain, with over 15 million tons per year of capacity scheduled to be shut down. Meanwhile, emerging markets continue to exhibit strong investment momentum. The global chemical industry landscape is being reshaped. “\"A highly challenging period,\" said Saniya Magdeburg, Vice President for Europe, Middle East, and Africa (EMEA) at Brenntag Specialities, during the EPCA annual meeting. She believes that due to the widespread shutdown of production facilities upstream and the current pressures on infrastructure, the European chemical market will see an increase in imports, especially in the commodities sector. Marco Menzinga, Director General of the European Chemical Industry Council (Cefic), made it clear that the industry is going through a \"highly challenging period\"; capacity consolidation and the rapid implementation of the Chemical Industry Action Plan are key to the industry’s recovery, with such a recovery possibly not occurring until 2028 at the earliest. The European chemical industry must first complete capacity restructuring and integration before it can experience genuine improvement. Earlier this year, the EU launched an Action Plan for the chemical industry, aimed at enhancing the competitiveness of the EU’s chemical sector and promoting its modernization. The European Commission stated in a statement that the action plan is accompanied by a Simplified Integrated Chemicals Act aimed at streamlining the EU’s legislation on key chemicals, as well as a proposal to enhance the governance and financial sustainability of the European Chemicals Agency. The bill includes simplifying the rules for labeling hazardous chemicals ； Clarification of EU cosmetic regulations ； Simplify the registration of EU fertilizer products by aligning information requirements with the standard rules of the EU’s Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH) regulation. The European Commission estimates that these measures will save the chemical industry at least 363 million euros per year. According to the China Chemical Industry News, an annual report released by the European Plastics Industry Association on October 8 showed that the European plastics industry is on the \"brink of collapse\"; its competitiveness is declining rapidly, market shares are shrinking, sales volumes are dropping significantly, and progress toward sustainable development has also come to a standstill. Data shows that Europe’s share in the global plastic industry continues to decline, from 22% in 2006 to 12% in 2024. Over the past three years, sales in this industry have also seen a sharp decline, dropping from €457 billion in 2022 to €398 billion in 2024. This represents a decrease of €59 billion, or 13%. The decline in Europe stands in stark contrast to the industrial boom being experienced in other regions. Last year, global plastic production increased by 4.1%, and it has risen by 16.3% since 2018. The report states that plastics produced in Asia currently account for 57.2% of the global total. The report states that evolving tariffs still pose a serious threat to the EU’s plastics industry. The United States is Europe’s largest source of imports of plastic polymers, accounting for 18.9% of those imports ； At the same time, the United States is also the fourth-largest export market for plastic products from the EU, with its imports accounting for 7.7% of the EU’s total exports. Polarization in Asia: After five rounds of global shifts in the chemical industry supply chain, Asia has become the largest market for the chemical industry. Looking at the growth in output value of the top 50 chemical companies worldwide, China’s leading chemical firms are still in a phase of expansion, with their output value growing at a significantly faster pace than that of companies in Europe and the United States; they are thus competing fiercely with these European and American chemical giants. Overall, the chemical industry in Asia is showing a polarized trend: Japan’s refining and chemical industry is in a state of decline, with production capacity continuing to shrink, and many chemical companies are taking measures such as closing factories or reducing their production capacities. On February 24th, Toray Corporation announced that it would cease producing phthalic anhydride (PTA) in Japan by 2026; the PTA production facility at its plant in Aichi Prefecture, with an annual capacity of 165,000 tons, will stop operating, which means that Japan’s domestic PTA production capacity will drop to zero. On March 31, Mitsubishi Chemical announced its decision to phase out production at its Onomihama plant and the Shin-Niigata Iwaki plant by the end of March 2027, due to difficulties in achieving profits resulting from changes in the market environment. On April 2, Mitsubishi Chemical announced that it would shut down its PET bottle manufacturing plants in Hiratsuka and Asai by the end of December 2025, with product sales to cease by the end of March 2026. The company stated that profitability in this business sector was extremely poor due to high raw material costs and logistics expenses. On April 1, Maruzen Petrochemical announced that its ethylene plant in Chiba, Japan, which has an annual production capacity of 525,000 tons of ethylene, will be closed in 2026. Maruzen Petrochemicals stated that due to an oversupply of ethylene worldwide and a decline in demand for ethylene in Japan, the country’s ethylene production facilities have been operating at reduced capacity; this decision was made to enhance competitiveness. On May 27, the board of directors of Asahi Kasei Corporation decided to withdraw from the businesses related to methyl methacrylate (MMA) monomer, cyclohexyl methacrylate (CHMA), polymethyl methacrylate (PMMA) resins, and styrene-butadiene latex, as well as to close its refining plant in Kawasaki, Japan. South Korea is in a mature stage, with relatively stable refining and aromatic production capacity, while its ethylene production capacity has expanded in recent years. However, in recent years, due to the slowdown in global economic growth and sharp fluctuations in energy prices, coupled with an increase in China’s self-sufficiency rate, the capacity utilization rates of the petrochemical industries in Japan and South Korea have declined significantly: South Korea’s PX/ethylene utilization rates dropped from 99%/93% in 2019 to 71%/79% in 2024 ； Japan’s PX/ethylene utilization rates declined from 84%/94% in 2019 to 61%/78% in 2023. Since the beginning of this century, India’s development has accelerated, and its chemical industry has become a rising force. According to IBEF, in 2024 India ranked 14th among the world’s largest chemical exporters and 8th among the largest chemical importers (both figures exclude pharmaceuticals), while also becoming the sixth largest producer of chemicals in the world. However, in terms of its global share, the sales volume of India’s chemical industry in 2020 accounted for only 3% of the global total, which is significantly lower than the proportion of its population in the world’s population. FICCI predicts that this share could double by 2030, indicating significant room for growth. Over the past few years, leading Indian chemical companies have outperformed most of their upstream and downstream industries, and they have also demonstrated strong performance in the global market. India has a large population, and its economy is developing rapidly. The middle class is continuously growing, leading to a steady increase in the demand for various petrochemical products. The Indian government has also introduced a series of policies to support the development of the petrochemical industry, such as establishing oil, chemical, and petrochemical investment zones (PCPIRs), plastic parks, and textile parks, as well as facilitating 100% foreign direct investment (FDI) through streamlined procedures. The Indian government also plans to attract $87 billion in investment for the petrochemical industry over the next decade. There has been continuous heavy investment in the Middle East, which leverages its resource endowments to capture market share; such substantial investments have been frequent in recent years. Policies such as Saudi Arabia’s “Vision 2030” and the UAE’s “Industry 4.0 Strategy” have created favorable conditions for the development of the chemical industry, facilitating the transformation of the Middle East from a traditional crude oil exporter into a hub for the production of high-value chemical products. Leading companies in the chemical industry in the Middle East are increasing their investments. As part of Saudi Arabia’s \"Vision 2030,\" Aramco is expanding its production of petrochemical products, shifting its focus from traditional fuels to chemicals and advanced materials. It aims to increase the share of chemical production from 15% to 30% by 2030. The company has invested $7 billion in collaboration with SABIC to develop a Crude-to-Chemicals (CTC) project, which allows crude oil to be converted into ethylene and aromatics without going through the traditional refining process, thereby increasing the efficiency of this conversion process to 70%-80%. SABIC’s ethylene production capacity reaches 30 million tons per year, with costs that are merely one-third of those in Europe. Thanks to partnerships with European distributors, its polyethylene exports to Europe increased by 22% in 2024, thereby squeezing out local European manufacturers. In the realm of chemical industry mergers and acquisitions, Middle Eastern giants have demonstrated strong financial capabilities and excellent strategic vision. At the beginning of 2024, Saudi Aramco announced plans to spend $50 billion over the next five years on mergers and acquisitions in the chemical industry. On September 11, 2024, Saudi Aramco announced that it had signed a development framework agreement with Rongsheng Petrochemical. The two parties are currently discussing Rongsheng Petrochemical’s proposed acquisition of a 50% stake in SASREF, a wholly-owned subsidiary of Saudi Aramco, as well as a potential acquisition by Saudi Aramco of up to 50% of the shares in Zhongjin Petrochemical, a wholly-owned subsidiary of Rongsheng Petrochemical. On the evening of April 22, 2025, Hengli Petrochemical issued a announcement stating that its controlling shareholder, Hengli Group, had signed a memorandum of understanding with Saudi Aramco. According to this agreement, Saudi Aramco or its affiliated entities intend to acquire from Hengli Group the shares it holds, which account for 10% plus one share of Hengli Petrochemical’s total issued share capital. In December 2024, Abu Dhabi’s **National Oil Company (ADNOC)** proposed to acquire shares in Covestro for 14.7 billion euros (approximately 121 billion yuan), a move that would enable ADNOC to expand its energy business beyond oil, with a focus on natural gas trading and chemical products such as plastics. On June 17, 2025, ADNOC submitted a bid of $18.7 billion (approximately 134 billion yuan) to Australian fossil fuel producer Santos for its acquisition. This is one of ADNOC’s key overseas initiatives to expand LNG production. In addition, Kuwait Petroleum Industries Company (PIC) acquired a 25% stake in Wanhua Chemical (Yantai) Petrochemical Co., Ltd. by investing $638 million. Reshaping of trade patterns: The global chemical industry is restructuring its competitive landscape, and as a result, trade patterns are also changing. The demand in traditional chemical markets such as those in Europe and the United States is recovering slowly, resulting in limited growth in demand for chemical products. In emerging markets, **with population growth, accelerating urbanization, and rising consumer demand, there is a continuous increase in the need for chemical products. Driven by strategic emerging industries such as new energy and new materials, the demand for high-end chemical products is on the rise, and these markets will become an important force driving growth in global chemical trade. Meanwhile, as the global chemical industry structure changes, the types of products traded are also being reshaped. In the traditional petrochemical trade, the growth rate of trade in fossil fuels such as oil, coal, and natural gas is expected to slow down. The explosive growth in demand for lithium batteries has led to a significant increase in the trade volume of lithium salts such as lithium carbonate and lithium hydroxide, as well as cathode materials like lithium iron phosphate and ternary materials, and anode materials such as graphite and silicon-based materials. Furthermore, the expansion of the solar photovoltaic industry has led to an increase in the trade of silicon materials such as polysilicon and monocrystalline silicon, as well as chemical products like EVA film and backsheet materials. The trading markets for related chemical products such as hydrogen energy and bio-based chemicals will also gradually take shape and expand.