China, SE Asia PP outlook for 2025: Capacity boom meets demand gloom
by Thi Huong Nguyen - thihuongnguyen@chemorbis.com

PP markets across China and Southeast Asia are set to end 2024 on a weaker note compared to the first half of the year, because concerns over growing supply and lower-than-expected demand have dampened players’ sentiment. As the year winds down, industry players are turning their attention to 2025, with supply-demand dynamics remaining the central focus.
2024 in review: Key takeaways
In the first half of 2024, a series of bullish factors like high production costs, escalating freight rates, import tightness, and favorable domestic supply boosted PP markets in China and Southeast Asia. However, the second half of the year saw a shift as buyer resistance and slowing demand took center stage. Even intermittent holiday-driven revivals could not offset the months-long bearish trend. Over the past few months, PP prices have mostly fluctuated within a narrow range.
China: Up in H1, mostly down in H2
Except for a week of decline in early January, China’s import PP markets followed a stable-to-higher trend until the middle of June. According to the weekly average data obtained from ChemOrbis Price Index, homo-PP raffia and inj. and PPBC inj. prices reached their 14-to-16-month highs at that time.
Nonetheless, the period from mid-June until late September, right before the Golden Week holiday, saw the import PP prices reversing previous gains to hit their year-to-date lows before posting slight increases thanks to renewed post-holiday demand. A narrow fluctuation has mainly dominated the markets since then, with the latest week recording fresh decreases of $10-20/ton.
SEA: Longest declining streak in mid-year
In general, Southeast Asia’s import PP markets tracked similar movements with a nearly three-month downturn in the middle of the year that saw homo-PP raffia and inj. and PPBC inj. prices posting cumulative losses of 8-9%. Even though prices have followed a stable-to-firmer trajectory lately, market sentiment has still been characterized by cautiousness in the face of the holiday lull and sluggish demand.
2025 around the corner: What lies ahead?
The PP markets in China and Southeast Asia are expected to face a complex landscape in 2025, marked by significant capacity expansions and moderate demand growth. China’s PP production capacity has been on a visible upward trajectory, while some startup plans have also been scheduled in Southeast Asian countries, leading to heightened oversupply on the horizon.
Besides, the global economic slowdown and China’s economic challenges may keep tempering downstream PP demand across the region, prompting Chinese exporters to boost exports to balance domestic supply surplus. This increase in exports may intensify market competition, exerting downward pressure on regional PP prices, particularly in Southeast Asia in the long run.
Capacity growth: China leads the way
The global PP markets witnessed massive capacity expansions in 2024, with the top place belonging to China. According to ChemOrbis Production News Pro, the country successfully put around 3.25 million tons/year of PP capacity into production in the first eleven months of the year, and huge capacities of 1.9 million tons/year have been scheduled to come online by the end of December.
ChemOrbis Production News Pro also suggests that the PP markets are expected to welcome even more PP capacities globally in 2025 with roughly 9 million tons/year, in which 6 million tons/year, or about 67%, of new capacities are located in China. That is of no surprise considering China’s commitment to becoming a net PP exporter through boosting production and exports in several years.
Meanwhile, PP plants are also in motion to introduce additional capacities in other parts of Asia in the next year. Indonesia plans to start a 400,000-ton/year PP plant in Q1 2025, while India and Japan are set to add 500,000 tons/year and 200,000 tons/year, respectively, by April, if everything goes on track.
China’s exports surge, SEA a key destination
In 2024, China’s PP outflow reached a historic record of around 2 million tons for the first ten months of the year, as per ChemOrbis Stat Wizard data. This showed an over 54% increase when compared to the cumulative figure for 2023. Vietnam and Indonesia were respectively ranked as the first and second biggest PP export outlets of China. Thailand and the Philippines were also in the top 10.
Notably, China’s PP exports in March posted titanic increases of 88% on year and 87% on month to reach 315,450 tons, the highest monthly volume since ChemOrbis began to collect data in 2000. The export volume surpassed imports during the same period and made China a net PP exporter for the first time. This scenario has yet to repeat itself since then.
Demand outlook: Mixed impacts of trade dynamics
Despite the capacity surge, regional demand growth is expected to be moderate in the upcoming year due to global economic stagnancy and China’s still-fragile economy. In addition, a supply overhang also means the absence of buyers’ desire for stocking up huge quantities, with most of them adopting strategic need-based purchases for a long time.
In the meantime, potential trade wars during the Trump 2.0 regime in the US may come with opposite effects on PP demand in China and Southeast Asia. The re-election of Donald Trump as US president earlier last month with the presidential inauguration on January 20, 2025, is anticipated to have substantial impacts on China’s economic environment due to potential US-China trade tensions. This is expected to further hurt China’s ongoing weak economy, which has been switched to a manufacturing and exports one.
Trump has indicated plans to implement a universal tariff of up to 20% on all imports, with specific proposals for tariffs as high as 60% on Chinese goods. Such tariffs would likely reduce the competitiveness of Chinese PP end products in the US market, potentially decreasing export volumes and affecting China’s production of finished goods and, in turn, demand for upstream PP polymers in 2025.
On the flip side, the possible policies in the Trump 2.0 government are expected to act as catalysts for increased manufacturing and export activities in Southeast Asia, elevating PP demand in the region. Due to US tariffs on Chinese goods, many companies are relocating manufacturing operations to Southeast Asia to maintain market access. The shift is expected to increase the buying power for PP, a critical material in various industries such as packaging, automotive, textiles, and electrical and electronics.
2024 in review: Key takeaways
In the first half of 2024, a series of bullish factors like high production costs, escalating freight rates, import tightness, and favorable domestic supply boosted PP markets in China and Southeast Asia. However, the second half of the year saw a shift as buyer resistance and slowing demand took center stage. Even intermittent holiday-driven revivals could not offset the months-long bearish trend. Over the past few months, PP prices have mostly fluctuated within a narrow range.

China: Up in H1, mostly down in H2
Except for a week of decline in early January, China’s import PP markets followed a stable-to-higher trend until the middle of June. According to the weekly average data obtained from ChemOrbis Price Index, homo-PP raffia and inj. and PPBC inj. prices reached their 14-to-16-month highs at that time.
Nonetheless, the period from mid-June until late September, right before the Golden Week holiday, saw the import PP prices reversing previous gains to hit their year-to-date lows before posting slight increases thanks to renewed post-holiday demand. A narrow fluctuation has mainly dominated the markets since then, with the latest week recording fresh decreases of $10-20/ton.
SEA: Longest declining streak in mid-year
In general, Southeast Asia’s import PP markets tracked similar movements with a nearly three-month downturn in the middle of the year that saw homo-PP raffia and inj. and PPBC inj. prices posting cumulative losses of 8-9%. Even though prices have followed a stable-to-firmer trajectory lately, market sentiment has still been characterized by cautiousness in the face of the holiday lull and sluggish demand.
2025 around the corner: What lies ahead?
The PP markets in China and Southeast Asia are expected to face a complex landscape in 2025, marked by significant capacity expansions and moderate demand growth. China’s PP production capacity has been on a visible upward trajectory, while some startup plans have also been scheduled in Southeast Asian countries, leading to heightened oversupply on the horizon.
Besides, the global economic slowdown and China’s economic challenges may keep tempering downstream PP demand across the region, prompting Chinese exporters to boost exports to balance domestic supply surplus. This increase in exports may intensify market competition, exerting downward pressure on regional PP prices, particularly in Southeast Asia in the long run.
Capacity growth: China leads the way
The global PP markets witnessed massive capacity expansions in 2024, with the top place belonging to China. According to ChemOrbis Production News Pro, the country successfully put around 3.25 million tons/year of PP capacity into production in the first eleven months of the year, and huge capacities of 1.9 million tons/year have been scheduled to come online by the end of December.
ChemOrbis Production News Pro also suggests that the PP markets are expected to welcome even more PP capacities globally in 2025 with roughly 9 million tons/year, in which 6 million tons/year, or about 67%, of new capacities are located in China. That is of no surprise considering China’s commitment to becoming a net PP exporter through boosting production and exports in several years.
Meanwhile, PP plants are also in motion to introduce additional capacities in other parts of Asia in the next year. Indonesia plans to start a 400,000-ton/year PP plant in Q1 2025, while India and Japan are set to add 500,000 tons/year and 200,000 tons/year, respectively, by April, if everything goes on track.
China’s exports surge, SEA a key destination
Given increasing new capacities and receding domestic demand, Chinese exporters have made all-out efforts to ramp up PP exports to mitigate a supply-demand imbalance at home, especially since early 2021, ChemOrbis Stat Wizard reveals. They tend to focus on export outlets that are price-sensitive, geographically close to China, or have free trade agreements with the country, with Southeast Asia being a top target. For that reason, an influx of Chinese-origin cargoes is likely to flood Southeast Asian PP markets with attractive prices in 2025.
In 2024, China’s PP outflow reached a historic record of around 2 million tons for the first ten months of the year, as per ChemOrbis Stat Wizard data. This showed an over 54% increase when compared to the cumulative figure for 2023. Vietnam and Indonesia were respectively ranked as the first and second biggest PP export outlets of China. Thailand and the Philippines were also in the top 10.
Notably, China’s PP exports in March posted titanic increases of 88% on year and 87% on month to reach 315,450 tons, the highest monthly volume since ChemOrbis began to collect data in 2000. The export volume surpassed imports during the same period and made China a net PP exporter for the first time. This scenario has yet to repeat itself since then.
Demand outlook: Mixed impacts of trade dynamics
Despite the capacity surge, regional demand growth is expected to be moderate in the upcoming year due to global economic stagnancy and China’s still-fragile economy. In addition, a supply overhang also means the absence of buyers’ desire for stocking up huge quantities, with most of them adopting strategic need-based purchases for a long time.
In the meantime, potential trade wars during the Trump 2.0 regime in the US may come with opposite effects on PP demand in China and Southeast Asia. The re-election of Donald Trump as US president earlier last month with the presidential inauguration on January 20, 2025, is anticipated to have substantial impacts on China’s economic environment due to potential US-China trade tensions. This is expected to further hurt China’s ongoing weak economy, which has been switched to a manufacturing and exports one.
Trump has indicated plans to implement a universal tariff of up to 20% on all imports, with specific proposals for tariffs as high as 60% on Chinese goods. Such tariffs would likely reduce the competitiveness of Chinese PP end products in the US market, potentially decreasing export volumes and affecting China’s production of finished goods and, in turn, demand for upstream PP polymers in 2025.
On the flip side, the possible policies in the Trump 2.0 government are expected to act as catalysts for increased manufacturing and export activities in Southeast Asia, elevating PP demand in the region. Due to US tariffs on Chinese goods, many companies are relocating manufacturing operations to Southeast Asia to maintain market access. The shift is expected to increase the buying power for PP, a critical material in various industries such as packaging, automotive, textiles, and electrical and electronics.
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