【2025 Tech Brief】Global polyethylene production capacity will exceed 160 million tons in 2025! China’s dependence on imported polyethylene remains over 30%!
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Our country is a net importer of polyethylene; in 2024, China’s net import volume of polyethylene was 13.03 million tons, representing a 3% increase compared to 2023. Imported supplies account for one-third of the total supply of polyethylene, indicating that imports still play a very important role in China’s polyethylene supply. Globally, the polyethylene industry is in a phase of capacity expansion. By 2024, the global production capacity for polyethylene had already exceeded 150 million tons, and further new capacity will be added during 2025 and 2026. It is estimated that by 2025, the total global production capacity for polyethylene will surpass 160 million tons. Northeast Asia is the main region where new capacity is being brought online, with China accounting for the vast majority of this additional capacity. Since 2020, when domestic large-scale petrochemical plants began to expand at an accelerated pace, coupled with the development of coal-based and light hydrocarbon processing facilities, China’s polyethylene production capacity has been growing at an annual rate of 10%. In terms of its share of production capacity, China’s polyethylene production capacity accounted for 15% of the global total in 2014, rising to 22% by 2024; it is expected to reach 25% by 2025.
As China’s polyethylene production capacity continues to increase, the domestic self-sufficiency rate rises, and some imported materials are gradually replaced by domestically produced ones. China’s dependence on polyethylene imports has been declining since 2019, dropping from a peak of 49% to 32% in 2023; in 2024, this dependence rose back to 33% on a quarterly basis. The reason for the increase in China’s dependence on polyethylene imports in 2024 is that there was limited new production capacity added to domestic polyethylene plants that year. The growth rate of new polyethylene production capacity in China in 2024 reached its lowest level since 2019, and the overall operating load of existing polyethylene production facilities declined compared to previous years. As a result, the supply of polyethylene within China decreased compared to 2023, necessitating an increase in imports to make up for this shortfall in domestic supply. In the long term, the production of polyethylene in China will continue. As China’s polyethylene production capacity grows and production technologies improve, its dependence on imports of polyethylene is expected to decline.
Looking at China’s sources of polyethylene imports for the entire year of 2024, the United States has replaced Saudi Arabia as China’s largest supplier of polyethylene, accounting for 17.2% of total imports; Saudi Arabia ranks second, with a share of 16.9% in China’s total polyethylene imports. Compared to 2023, the increase in polyethylene imports came mainly from the UAE, with a month-on-month increase of 560,000 tons, while imports from Qatar, Saudi Arabia, and the United States all decreased.
The United States itself possesses abundant and inexpensive ethane resources, giving it a significant cost advantage. On this basis, the United States has continued to expand its polyethylene production capacity, with several new production facilities coming online in the period from 2022 to 2023. According to statistics from consulting firms, the total PE production capacity in the United States in 2024 reached 28.171 million tons, resulting in a significant increase in local polyethylene supply. To absorb this increase in supply, the United States has actively increased its polyethylene exports. According to statistics for 2024, North America’s net polyethylene exports amounted to nearly 12 million tons; the United States is now the world’s largest exporter of polyethylene. Since 2023, China has surpassed Mexico to become the main destination for U.S. polyethylene exports. In terms of specific varieties, the main product exported by the United States to China is standard LLDPE, which accounts for 21% of total LLDPE imports. In terms of import volumes, as most of the new production facilities brought online in the United States in recent years are capable of producing LLDPE and HDPE, there has been a significant increase in the exports of LLDPE and HDPE from the U.S. to China since 2023.
The Middle East is also one of the important regions in the world for polyethylene production. The Middle East accounts for around 16% of the world’s total polyethylene production capacity, making it the third-largest producer of polyethylene in the world as well as the second-largest exporter. In 2024, the net export volume of polyethylene from the Middle East was approximately 11.5 million tons. The Middle East possesses abundant oil and gas resources and low production costs. However, due to tensions in the Red Sea and congestion at some ports, freight rates and shipping times on routes between Asia and the Middle East were affected to varying degrees in 2024. Additionally, reductions in European chemical production capacity have altered global trade patterns; not only has Europe itself changed from a net exporter to a net importer, but its traditional export markets (such as Africa) have also begun seeking supplies from other markets. As a result, imports of polyethylene from the Middle East to China have decreased.