China’s PE, PP new capacity wave gathers pace across Q1 and April, coinciding with tariff turmoil

Despite sluggish global demand, persistent oversupply, and rising trade tensions, China continues to ramp up its PP and PE capacities. The first quarter of 2025 and April have already seen a wave of plant start-ups, reflecting the country’s long-term strategy to boost petrochemical self-sufficiency, even in the face of ongoing market challenges. However, as the US-China trade war intensifies, questions loom over how these new tariffs will affect China’s ability to maintain its aggressive expansion plans.

From late 2024 through April 2025, a growing number of large-scale PE and PP projects have either come online or are on track to begin commercial operations. These new additions emphasize China’s commitment to boosting its domestic production capacity, even as global consumption weakens, and export opportunities shrink. However, with the ongoing trade tensions, particularly the imposition of new tariffs, the global marketplace may see diminishing returns on these new investments.

PE start-ups: Major projects unfold

• Sinopec Tianjin-Ineos JV (Nanyang JV): After a two-year delay, the HDPE/LLDPE (300,000 tons/year) and HDPE (500,000 tons/year) units in Tianjin came online in November 2024, in tandem with the ethane cracker.


• Wanhua Chemical: The company commissioned its LDPE unit (250,000 tons/year) in Yantai in December 2024, ahead of its cracker start-up in Q1 2025.


• Shandong Yulong Petrochemical: This mega complex in Yantai has already commissioned three units: a 500,000 tons/year HDPE/LLDPE swing plant (Dec 2024), a 300,000 tons/year HDPE unit, and another 500,000 tons/year swing line (both in Jan 2025). A fourth HDPE line (450,000 tons/year) is expected by July 2025.


• Inner Mongolia Baofeng: Two HDPE/LLDPE lines (500,000 tons/year each) reached on-spec production in Jan and Feb 2025. A third line, delayed due to upstream issues, is targeting start-up by end-April 2025.


• ExxonMobil (Huizhou): Commercial production at two LLDPE units (500,000 tons/year and 730,000 tons/year) is expected in April and June 2025. LDPE (500,000 tons/year) is slated for Q2.


• Shandong Jincheng: Commissioning of HDPE (450,000 tons/year) and LLDPE (250,000 tons/year) units in Zibo is expected in April 2025 following February test runs.

PP start-ups: Parallel momentum in polypropylene

• Sinopec Tianjin-Ineos JV (Nanyang JV): The 350,000 tons/year PP plant was brought online in November 2024, in sync with the PE lines.


• Shandong Yulong Petrochemical: Three out of five PP lines (300,000 tons/year and two 400,000 tons/year) started up between December 2024 and January 2025. The remaining two (400,000 tons/year each) are expected by mid-2025.


• Inner Mongolia Baofeng: Three 500,000 tons/year PP plants in Ningxia were commissioned progressively in Jan, Feb, and Mar 2025.


• Shandong Jincheng: A 150,000 tons/year PP plant in Zibo was brought online in November 2024.


• ExxonMobil (Huizhou): Two PP lines (450,000 tons/year and 400,000 tons/year) are expected to begin operations in April 2025, following earlier cracker start-up.

Will new tariffs halt expansion plans?

The US has already implemented tariffs on a range of Chinese products. While these measures will affect end-product exports to the US, they haven’t yet slowed China’s capacity additions. But with export opportunities becoming even more limited, how will China’s strategy to ramp up production play out in the coming years? Will domestic demand alone be sufficient to absorb this additional supply, or will international trade restrictions force China to reconsider its approach?

According to ChemOrbis Supply Wizard, China has brought 1.8 million tons/year of new PE capacity online so far in 2025, with plans to add more than 4.4 million tons/year over the remainder of the year. For PP, the country has already added 2.3 million tons/year of new capacity in 2025, with another 5.4 million tons/year scheduled to come online by the end of the year.

Looking ahead, China plans to add around 4.7 million tons/year of new PP capacity in 2026, followed by 5.9 million tons/year in 2027. As for PE, the country is expected to add 5.7 million tons/year in 2026 and 8.3 million tons/year in 2027, provided all projects proceed as planned.