Asian Markets
October 21, 2026
Chinese Polyether Polyol Capacity
Capacity Tops 11 Million t/y, but Margins Diverge: A New Phase for China’s Polyether Market?
October 12, 2026 6 min read
No mention of operating rates! Editor
Expansion continues and exports remain important, while product mix and cost control become the new dividing lines
In 2026, China’s polyether polyol (PPG) industry continues to expand, but the most important issue is no longer simply “how much capacity has been added.” Under the current statistical methodology, China’s polyether polyol capacity increased from 10.569 million t/y in 2025 to 11.209 million t/y in 2026, up about 6.1%. Meanwhile, China exported approximately 1.773 million tonnes of polyether polyols in Jan–Jul, up 14.6% year on year, while imports fell to around 0.124 million tonnes, down 29.5%. Supply capability continued to expand and exports remained an important outlet for domestic supply, while the price level was also significantly higher than last year. By the end of September, 2026 average prices for six mainstream grades—flexible foam, high-resilience, CASE, rigid foam, conventional POP and high-resilience POP—were about 21%–27% above their full-year 2025 averages. However, higher prices did not translate into improved margins for every product, and structural divergence in China’s polyether polyol market became increasingly pronounced.
Figure 1 Key Data for China’s Polyether Polyol Market in 2026
Expansion Has Not Ended Above 11 Million t/y
At the company level, China’s polyether polyol capacity posted a net increase of about 0.64 million t/y in 2026. New capacity or capacity adjustments were recorded at Changhua Chemical, Guangxi Huayi, Guangxi Tongkun, Shandong Longhua and other producers, while effective capacity at certain companies was restated based on actual plant conditions. The 11.209 million t/y total is therefore not a simple sum of all newly built projects; it reflects new units, revamps and adjustments to existing capacity. More importantly, the project pipeline remains substantial. Based on projects currently tracked, planned or proposed projects for 2027 alone already exceed 1.40 million t/y, involving Changhua, Wudi Dexin, Befar, INOV, Sinochem Dongda, Huajin United Petrochemical and others. Although the eventual start-up dates of some projects remain uncertain, one point is clear: supply-side competition has not ended. The industry’s focus will gradually shift from whether new supply is coming to how that supply can be absorbed by the market.
Figure 2 China Polyether Polyol Capacity Changes and the Project Pipeline
Exports Are Still Growing, but the In-Year Pattern Has Shifted
Overseas markets remain an important outlet for China’s polyether polyol supply. In Jan–Jul 2026, China exported approximately 1.773 million tonnes, up 14.6% year on year; imports were about 0.124 million tonnes, down 29.5%, further strengthening the market’s net-export position. However, export growth was not evenly distributed through the year. Shipments reached a clear high of about 0.422 million tonnes in March, then fell rapidly to around 0.190 million tonnes in April. From May through July, monthly volumes broadly returned to the 0.18–0.22 million tonne range. In other words, exports showed a clear pattern of front-loaded release followed by a return to more normal levels.
China’s overseas polyether polyol flows also remained geographically diversified. In Jan–Aug, India was the largest single destination at about 0.238 million tonnes, followed by Türkiye at approximately 0.191 million tonnes and Vietnam at around 0.149 million tonnes. Indonesia, Russia, Brazil and Mexico also maintained meaningful volumes. As domestic supply capability continues to expand, the key question is no longer simply whether exports can keep growing, but how different overseas markets can absorb incremental Chinese supply in terms of price, timing and product mix.
Figure 3 China Polyether Polyol Export Pattern and Major Destinations in 2026
Prices Moved Higher Across the Board, but Not Every Grade Earned More
The price level of mainstream polyether polyol products rose markedly from last year. By the end of September, the average price of flexible foam polyether was about RMB 9,847/mt, up around 26% from the full-year 2025 average; high-resilience polyether averaged about RMB 10,319/mt, up 25%; CASE polyether averaged approximately RMB 10,302/mt, up 27%; and rigid foam polyether averaged around RMB 9,849/mt, up 21%. Conventional POP and high-resilience POP averaged roughly RMB 10,501/mt and RMB 10,854/mt, respectively, representing increases of about 24% and 21% from their 2025 averages.
During the year, polyether polyol prices remained closely linked to upstream propylene oxide (PO) costs. In March and April, crude oil, propylene and PO costs rose rapidly, lifting prices across the major polyether polyol grades. In the second quarter, PO prices retreated and the pass-through of high prices to end users encountered resistance, prompting a broader market correction. In August and September, the market strengthened again as PO moved higher. Overall, price changes in 2026 still showed a clear cost-driven pattern, but the ability to pass through those costs increasingly differed by product.
Figure 4 Average Prices for Major Polyether Polyol Grades in 2025 and Jan–Sep 2026
Margins, Not Selling Prices, Are Creating the Real Divide
Judging by selling prices alone, 2026 might appear to be a broadly improved year for the polyether polyol industry. Once feedstock costs are included, however, profitability diverges sharply across products. Based on the current cost model, the Jan–Sep average theoretical margin was approximately RMB 612/mt for rigid foam polyether, RMB 599/mt for conventional POP and RMB 494/mt for high-resilience polyether. These grades delivered relatively stronger results; high-resilience and rigid foam polyether remained profitable in all nine months covered by the current statistics.
By contrast, flexible foam polyether recorded an average theoretical margin of about RMB -43/mt in Jan–Sep and was profitable in only three months; CASE polyether remained close to break-even; and high-resilience POP faced the greatest pressure, with an average theoretical margin of approximately RMB -576/mt and positive margins in only two of the nine months. Although all these products were exposed to the same increase in PO costs, differences in formulation, other feedstock costs, consumption ratios and price pass-through capability produced very different outcomes. Rising polyether polyol prices therefore do not necessarily mean that producers can improve margins at the same pace. As capacity continues to expand, product structure is becoming an increasingly important dividing line in profitability.
Figure 5 Theoretical Margins for Major Polyether Polyol Grades in Jan–Sep 2026
Beyond 2026, Where Will the New Supply Go
Overall, China’s polyether polyol market in 2026 is moving from a relatively simple phase of scale expansion into a more complex period of structural competition. Capacity has already exceeded 11 million t/y and a sizeable project pipeline remains. Exports are continuing to shoulder an important supply-absorption role, but monthly shipment patterns and the performance of individual destination markets are changing. At the same time, prices for major polyether polyol grades have risen sharply, without delivering synchronized margin improvement across all products.
This means that the next stage of industry competition will no longer be defined by capacity alone. Product mix, feedstock and cost-management capability, plant operating efficiency, customer structure and overseas market development will jointly determine whether new capacity can be converted into stable sales and sustainable profits. For China’s polyether polyol industry, the key question is no longer simply “how much capacity is there,” but where incremental supply will flow and which products can generate sustainable margins.
Figure 6 Initial Assessment of China’s Polyether Polyol Market in 2026
PUdaily’s 2026 Asia-Pacific PPG Industry Landscape and Trend Outlook Report will focus on the China market and provide a detailed review of polyether polyol capacity, major producers, imports and exports, prices, costs and margins, and downstream consumption. Drawing on announced and proposed projects, the report will also forecast the supply-demand structure and market trends in China and the broader Asia-Pacific region for 2027–2031.
October 20, 2026
Anti-Involution and Involution
China’s Chemical Industry: Anti-Involution Policies Struggle to Resolve Overcapacity Dilemma
Under the anti-involution policy, China’s chemical industry still faces declining profits, falling prices, and export resistance, indicating that the overcapacity problem is deeply entrenched, and new energy materials may become the next risk point.
Amira Lin08/17/2026, 12:504 min readAuthor profile
In 2025, China’s top leadership made “anti-involution” the core direction of its industrial policy, attempting to reshape manufacturing competitiveness by cutting overcapacity and curbing blind investment. However, for the chemical industry—a sector characterized by heavy assets, strong cyclicality, and extreme fragmentation—the implementation of the policy has encountered significant resistance. The latest data show that the chemical industry not only failed to emerge from the downturn with the help of the policy tailwind, but instead sank deeper into an adjustment period under the combined pressure of weak demand and excess supply.
According to data released by China’s National Bureau of Statistics on November 27, in the first ten months of 2025, total profits of industrial enterprises above designated size reached $827 billion, a slight year-on-year increase of 1.9%. However, profits in the manufacturing of chemical raw materials and chemical products fell by 5.4% year-on-year, recording only $43 billion. The profit growth rate of the chemical sector significantly underperformed the broader market, clearly illustrating the headwinds currently facing the industry.
The direct driver of the profit decline is the continued contraction in prices. A research report from Cinda Securities pointed out that China’s chemical product price index has fallen for three consecutive years, with a cumulative decline of nearly 36%. Analyst Zhang Yansheng believes that this price collapse stems from two structural contradictions: first, the long-standing overcapacity in key chemical product markets; and second, the slowdown in downstream demand caused by decelerating economic growth and the deep adjustment of the real estate sector. Although the growth rate of chemical projects under construction eased in 2025, the absolute scale of investment is still climbing, indicating that the capacity cycle is far from bottoming out.
To address overcapacity across the industry, Beijing launched an “anti-involution” campaign in March, encouraging enterprises to cut output and postpone the construction of new facilities. The policy once brought confidence to the market: after major producers agreed to reduce output, caprolactam prices rose about 5% month-on-month in November; the industry prosperity index compiled by the China Petroleum and Chemical Industry Federation also rebounded from 98.43 in August to 99.79 in October. However, this recovery lasted only two months, and the prosperity index fell back to 99.79 in November, returning to the contraction zone at 97.21.
“Anti-involution is far more complex than a slogan,” said Qiu Dengke, secretary-general of the Guangzhou New Energy Industry Association and a senior chemical industry analyst. “In a segmented market composed of thousands of small and medium-sized enterprises, no company is willing to proactively cut output and cede market share to others.” More critically, local governments lack the motivation to implement the policy. As the main implementers, local governments, under pressure from tax revenue and employment, often hold reservations about mandatory production cuts—this constitutes a deep institutional obstacle to the implementation of the anti-involution policy.
Looking ahead to 2026, the fundamentals of the chemical industry remain far from optimistic. The domestic real estate market continues to be sluggish, suppressing demand for bulk chemical products such as building materials and coatings. On the export front, as China’s chemical products continue to expand their global market share, trade protectionism is intensifying. Qiu Dengke predicts that anti-dumping investigations and local content requirements targeting Chinese chemical products will become more frequent, and the export environment may deteriorate further.Not all sectors lack bright spots. Driven by the “new three items” industrial chain, demand for chemical materials used in electric vehicles, energy storage batteries, photovoltaic modules, and high-performance fibers achieved over 8% growth in 2025, a trend also corroborated by statistics from the China Chemical Information Center. However, Qiu Dengke warned: “Production capacity for new chemical materials is expanding at an unprecedented rate. Without strict, punitive constraint mechanisms, this emerging track is likely to replay the overcapacity script of traditional chemical products within two years.”
The predicament of China’s chemical industry is essentially a contest between industrial upgrading and the old growth model. The anti-involution policy has captured the crux of the problem, but at the implementation level it is constrained by the triple reality of market fragmentation, local government rivalry, and insufficient demand. In the short term, administrative measures can only temporarily prop up prices, but can hardly reverse the long-term pain of capacity clearance. For China’s chemical industry, the real way out may lie not in “how to cut production” but in “how to upgrade”—reshaping its position in the global chemical value chain through technological innovation, M&A integration, and global footprint. And this is destined to be a protracted battle that requires time.
https://www.chinaindustrybrief.com/en/articles/china-chemical-industry-overcapacity-policy-2026
内卷 (Involution): The Word That Defines China’s Endless Competition
Introduction:
There’s times I catch myself comparing how much I studied last night or how much work I did, and sometimes I feel guilty when I relax while others kept working. It’s that quiet, persistent sense that no matter what I do, when I compare myself to others there’ll always be someone putting in more effort and working harder. And even when there is no one else for some reason if feels like there should be. These thoughts aren’t neccesarily unique to me, they’re part of an overall pressure that defines our modern life. The Chinese have a slang word for this exact feeling, “内卷” or “Involution”. It describes the cycle of working harder and harder, yet never really moving forward like running on a societal treadmill that keeps speeding up but you still end up in the same place. I chose to explore this word because it encapsulates a lot of the emotions like anxiety, ambition, and fatigue that I and so many students and workers experience every day.
Origins and Evolution:
Before it became one of China’s most famous buzzwords, the concept of involution first appeared in the 1960’s when an American Antropolgist Clifford Geertz used it describe how Javanese farmers were working harder and harder on the same plots of land but producing no real growth, basically an endless cycle of effort without progress. Decades later, Chinese scholars adopted this word to describe similar social patterns of people investing more time and energy but seeing diminishing returns. Fast forward to our modern digital age 内卷 took on a whole new life online. Around 2020, Chinese students and young professionals started using the term on Weibo and Zhihu (chinese social media apps) to describe their own lives like staying up until 3 a.m. to study for an exam, competing for internships, or joining a hundred different WeChat groups just to stay ahead. What started as an academic joke ended up defining a generation caught between ambition and exhaustion. So in our modern day, 内卷 isn’t about farming anymore. It reflects how young Chinese navigate a society that praises hard work yet very rarely slows down to ask if it’s all really worth it. From viral memes showing students sleeping on their desks to workplace jokes about “卷王” (the “King of Involution”), the word evolved into both a coping mechanism and sort of a implicit protest to joke and acknowledge the system that places so much pressure on it’s people.
This graphic is commonly used to show involution and workers burnt out and exhausted over the constant grind of working in Chinese culture.
Usage:
The word is often used when students compare how late they studied or when office workers share pictures of sleeping at their desks. The word captures that collective exhaustion from constant competition, where everyone feels pressured to do more even when there’s little to gain.
Netizens use 内卷 in both serious and humorous ways. Saying “太卷了” (“It’s too involuted”) can express frustration and irony. The term has also branched out to phrases like 卷王 (“Involution King”), describing those who push themselves the hardest.Regardless of how it is used though it has become a single word to describe the burnout being faced by students and workers in chinese culture.
Cultural Analysis:
At its core, 内卷 reflects two forces that have long shaped Chinese life, Confucian diligence and Daoist balance. From Confucianism comes the belief that hard work and self improvement are moral obligations. For centuries, this value defined education and family life as effort showed virtue and success was proof of your character and value. Today, that mindset still drives people to push themselves endlessly turning the discipline and diligence into exhaustion.
On the other hand, Daoism offers an escape from this. Its philosophy of wui wei encourages people to step back and live in harmony with the world instead of fighting against it. The growing appeal of another term 躺平 (“lying flat”) shows a return to that thinking, where peace is found not in striving but by letting go and being content.
In this way, 内卷 and 躺平 represent two sides of the same culture, one rooted in ambition, and the other in acceptance. Together they sort of capture the Chinese struggle to balance ancient ideals with the reality of burning out and the ill effects that causes.
A good example of this is the 996 work culture shown in this video is the real world face of 内卷. It captures how long hours and relentless competition have become normalized in modern China, turning Confucian diligence into exhaustion. It helps show the meaning of involution, how people work so hard – hours from 9.am. – 9 p.m. 6 days a week yet never truly progress anywhere and end up burnt out and exhausted rather than at rest and satisfied.
Reflection:
When I think about 内卷, I don’t just see it as an online thing or restricted to Chinese culture. I see it in myself and the people around me. Especially that fear of falling behind in school, internships, and overall just growth as a person. Writing this made me realize that 内卷 isn’t just about competition, it’s about searching for purpose and what brings you peace in a world that never slows down. And the challenge isn’t to escape it completely, but to find a balance of working hard while being content and retaining peace.
sites.gatech.edu/china-cultural-odyssey/2025/10/08/%E5%86%85%E5%8D%B7-involution-the-word-that-defines-chinas-endless-competition/
September 29, 2026
OCI to Exit TDI Production and Sales
South Korea’s OCI announced its withdrawal from the TDI business, and will cease production and sales from December 18.
2026-09-29 15:07:48Source: Toocle Headlines
On September 29, 2026, South Korea’s OCI announced that its board of directors had approved the termination of the toluene diisocyanate (TDI) manufacturing and sales business, and plans to officially cease relevant production and sales from December 18, 2026. OCI’s current TDI production capacity is approximately 50,000 tons per year.
According to the announcement, OCI’s TDI business achieved sales of approximately 117.947 billion Korean won in 2025, accounting for 5.87% of the company’s consolidated sales. The company stated that the exit from TDI is mainly to “sort out marginal businesses and improve profitability”, and it will enhance corporate and shareholder value by optimizing the business portfolio, rather than packaging and selling the plant.
OCI also reminded that the specific suspension date may be adjusted according to the progress of the exit. With its withdrawal from the TDI sector, the execution of existing orders, inventory digestion and the supply pattern of TDI in the Asia-Pacific region and globally deserve continuous attention.
September 8, 2026
Chinese Propylene Oxide Update
SunSirs: The Propylene Oxide Market Saw an Upward Shift in Its Price Center in August
2026-09-08 12:25:01Source:ChemNet
In August, the domestic propylene oxide market exhibited a wide-ranging “M-shaped” fluctuation pattern, with the overall price level shifting significantly upward. Data from the SunSirs monitoring system indicates that as of August 31, the benchmark price for propylene oxide stood at 9,350 RMB/ton, marking a 1.63% increase compared to the beginning of the month.
Raw Materials: There is strong cost-side support. Prices for the feedstock propylene remain high. According to the SunSirs monitoring system, the benchmark price for propylene stood at 8,721.00 RMB/ton as of August 31, marking a 10.01% increase from the beginning of the month (7,927.67 RMB/ton). International oil prices have trended upward due to geopolitical tensions, further solidifying the cost floor across the industry chain. Under the pressure of high costs, many production processes within the industry are operating at a loss, creating a strong price floor for propylene oxide.
Supply side: Market supplies remained tight due to a concentration of plant maintenance shutdowns. Domestic propylene oxide production in August totaled 499,800 tonnes—down 0.64% month-on-month and 5.70% year-on-year—with the capacity utilization rate falling to 60.25%. Multiple units, including those at Zhenhai Phase II, Qixiang, Lianhong, and Satellite Chemical, were offline; an unexpected shutdown of Wanhua Chemical’s Phase III unit further exacerbated the tight spot supply situation. Total production losses due to maintenance remained at a high level of approximately 220,000 tonnes for the month.
Demand side: Overall performance remains weak. August falls within the traditional off-season for demand, with sluggish trading activity in sectors such as upholstered furniture, home appliances, and automobiles. Downstream polyether manufacturers and the end-user foam industry are strongly resistant to high-priced raw materials, limiting procurement primarily to small, essential orders with little growth in new order volumes. However, continued external purchasing by major players like Wanhua Chemical has, to some extent, offset this weak demand.
Overall Forecast: Market variables are increasing in September. On the supply side, facilities such as those of Lianhong New Materials and Shenghua New Materials are expected to resume production, potentially leading to a gradual rise in supply pressure; however, large-scale facilities are still scheduled for maintenance in the second half of the year. On the demand side, the arrival of the traditional “Golden September and Silver October” peak season is likely to drive a moderate recovery in downstream demand. Overall, the propylene oxide market is expected to experience fluctuating trends in September, shaped by the interplay between cost support and supply-demand dynamics; key factors to monitor include the actual progress of facility restarts and the recovery of downstream demand during the peak season.
September 3, 2026
Asian Shipment Delays
Over 50% of vessels delayed at Asia’s busiest container ports
Congestion at Asian ports has been driven by extreme weather events and wider supply chain disruption
Marcus Hand,Editor
September 3, 2026
Credit: Pixabay
Analysts Sea-Intelligence say that all 14 of the busiest container ports in Asia have seen a decline in on-time vessel arrivals.
The world’s two largest container ports – Shanghai and Ningbo-Zhoushan have been consecutive typhoons this year, most recently typhoon Saudel last week causing severe delays at the ports.
Ningbo, which became the world’s second largest container port in the first half of 2026, saw its reliability fall by 20.1 percentage points to 34.6% in the month of July according to Sea-Intelligence.
The analyst described the picture in Shanghai as “particularly alarming” with a 19.2 percentage points drop in reliability resulting in just 21% of vessels arriving on time at port in July.
“Outside of extreme pandemic‑era supply chain disruptions, schedule reliability in Shanghai has never dropped this low in 14 years of recorded data,” commented Alan Murphy, CEO of Sea-Intelligence.
The largest drop in schedule reliability among top Asian ports was seen at Yantian in South China with a 23.5 percentage point plunge to 48.3% in July. Hong Kong also saw a 20.4 percentage point drop in reliability to 51.6% for July.
The fall in reliability was pronounced at the world’s largest transhipment hub of Singapore with a 5.7% percentage point drop in July, however reliability sat at just 43.2% Sea-Intelligence said. Looking at other ports in the region Port Klang had 33.3% reliability and Busan 40.9%.
The growth in delays at major Asian ports has driven a drop in schedule reliability for container to 56.1% falling 6.1 percentage points the steepest single month decline since the height of the pandemic in January 2021 the analyst said.
“With the region’s busiest ports operating with more than half of their incoming vessels delayed, this backlog will naturally cascade through the maritime network, likely triggering a new wave of delays for critical head‑haul trade lanes in the coming months,” Murphy said.
Port congestion in Asia is pushing lines to end two and half year long rerouting of Asia – Europe services via the Cape of Good Hope back to the Suez Canal and the Red Sea despite the ongoing security threat from the Houthi in Yemen with its “blockade” of Saudi Arabian ports.
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