White Paper on China's C4 Industry Chain in 2025: Leap from "Fuel Era" to "High-end Raw Material Era"

1. raw materials pattern: LPG establishes "chemical core" status, infrastructure to ensure supply resilience

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2025, China's liquefied petroleum gas (LPG) market officially bid farewell to the era of civilian fuel dominance. For global traders, China is no longer just an energy buyer, but the world's largest propane/butane feedstock processing center.

1. Consumption structure reconstruction and import high dependence

China's total LPG consumption exceeded 60 million tons by the end of 2025. Among them, the proportion of chemical utilization has jumped to more than 70%, while the traditional civil fuel has been reduced to less than 30%.

• Trade opportunities:

  imports of propane exceed 28 million tons and liquefied butane exceed 7.3 million tons. The huge import gap means that China's bargaining power and arbitrage demand for North American and Middle Eastern sources will remain high.

2. Infrastructure "billion-level" expansion to reduce logistics friction

2025, the coastal core petrochemical area intensive investment and construction of a number of world-class storage facilities, significantly improve the turnover capacity of import sources:

• , PetroChina Yancheng Primary Freezer: 1.5 million tons per year to fill the energy gap in northern Jiangsu.

• Dongying Port and Jieyang Wharf:

  The commissioning of the million-ton reservoir area and 50000-ton berths indicates that the raw material loading and unloading efficiency of the petrochemical clusters in northern and southern China has reached the international leading level.

2. Derivatives Technology Transition: Biobased C4 and High Purity Isobutene Global Competitiveness

in the field of C4 deep processing, Chinese enterprises are through technology iteration, from "cheap volume" to "high purity and green" premium route.

1. Bio-based butane: green barriers under the new track

2025 to become "bio-based C4 first year". Guangxi has put into operation the first 100000 t/a biological butane plant in China (bagasse fermentation route). For overseas downstream buyers who focus on environmental, social and corporate governance (ESG) (such as high-performance tires and bioplastics), the bio-based C4 supplied by China will become a new weapon to break through the "carbon tariff" in Europe and the United States.

of 2. High-purity isobutylene: Special materials "domestic substitution" and output With the production of high-purity (99.99) projects such as Jinling Huntsman and Yulong Petrochemical, China's isobutylene purification technology has overcome the core barriers such as molecular sieve adsorption and catalytic distillation.

• Market Value:

  These high-purity products are directly benchmarked against the global pharmaceutical intermediates, semiconductor chemicals and specialty rubber markets, and overseas traders can focus on their export potential in electronic-grade applications.

3. stock game: MTBE's "danger" and "machine"

As a traditional oil transfer feedstock, MTBE is facing the dual pressure of upgrading global fuel standards (expected by China 7) and replacing ethanol gasoline.

• the production capacity reached the top: the total production capacity exceeded 31 million tons, the industry operating rate is facing challenges.

• The transformation path: MTBE cracking high-purity isobutene has become the mainstream self-rescue path. In addition, the growing demand for electronic and pharmaceutical-grade MTBE is becoming a "safe haven" for high profits ". Traders should pay attention to how pallets originally used for oil blending are converted into high value-added fine chemical products through refining processes.

4. trader strategy: grasp the 2026 new standard implementation window period

The new national standard of GB 11174-2025 "LPG" issued in November 2025 will be implemented from November 2026.

• the compliance threshold: the strict sulfur content and VOCs limit will eliminate a large number of low-end mixed C4 suppliers.

• Market integration:

  traders should give priority to targeting large petrochemical bases with high-standard testing capabilities, and pay attention to the price arbitrage space brought about by classification refinement (industrial vs civilian).

to conclusion: the qualitative change in 2025 indicates that China's C4 industrial chain has completed the transformation from "quantity" to "quality. For overseas practitioners, this means that a more large-scale advantage, greener and more professional supply source of high-end chemicals is rising.