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China's petrochemical industry is ushering in a new round of large-scale capacity expansion. The six strategic projects under construction have a total investment of more than 300 billion yuan, covering core categories such as oil refining, ethylene, polyolefins and new materials, and are expected to be put into production in succession between 2026 and 2030.
China's petrochemical industry is ushering in a new round of large-scale capacity expansion. The total investment of the six strategic projects under construction exceeds 300 billion yuan RMB covering core categories such as oil refining, ethylene, polyolefins, and new materials, it is expected to be put into production between 2026 and 2030, which will have a significant impact on the global chemical trade pattern.
| Project | investment | location | expected production | core size |
|---|---|---|---|---|
| shandong Yulong Petrochemical Downstream Extension Industry Chain | 117.857 billion yuan | yantai, Shandong | 2029 | including high-end new material devices such as POE |
| petroChina Dalian Petrochemical (Nishinakajima) | 68.5 billion yuan | dalian, Liaoning | around 2030 | 10 million tons of oil refining +1.4 million tons of ethylene |
| sinopec Yueyang Ethylene Refining Integration | 35.68 billion yuan | yueyang, Hunan | 2028 | 1 million tons of ethylene +14 sets of downstream units |
| fujian Zhongsha Gulei Ethylene | 42.07 billion yuan | zhangzhou, Fujian | 2026 (fastest) | 1.5 million tons of ethylene |
| qilu Petrochemical Transformation and Upgrading | 24.4 billion yuan | shandong Zibo | 2027 | 10 million tons of oil refining +1 million tons of ethylene |
| dushanzi Tarim Phase II Ethylene | about 20 billion yuan | dushanzi, Xinjiang | september 2026 (fastest) | 1.2 million tons of ethylene, with a localization rate of over 98% |
short-term (2026): Two projects are the first to go into production and require immediate response. Fujian Zhongsha Gu Lei (1.5 million tons of ethylene) and Dushanzi Phase II (1.2 million tons of ethylene) are both planned to be put into production in 2026, with a total additional ethylene production capacity of 2.7 million tons/year, which will directly affect the Asia-Pacific supply and demand balance of derivatives such as polyolefin and EO/EG. Overseas buyers should evaluate the existing contract structure and price expectation.
Long-term concern: new signals for POE and green chemicals. Yulong Petrochemical and Dalian Xizongdao have both laid out POE devices, which directly point to the localization of photovoltaic packaging film raw materials. Dushanzi Project has set a new benchmark for the greening and autonomy of domestic refining with all-electric drive ethylene three machines, CO capture equipment and a localization rate of more than 98%. This means that China's dependence on imports of high-end chemicals will accelerate change, and overseas suppliers need to re-examine their export strategies to China.
Overall, 2026-2029 is a key window period for observation and layout of China's chemical market. It is recommended that overseas traders and supply chain practitioners closely follow the progress of each project node, study and judge the price trend of products in advance, and adjust the procurement, sales and inventory strategies in a timely manner.
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