Oversupply Vs. New Opportunities: At The Crossroads of China's UHMWPE Industry

Oversupply Vs. New Opportunities: At The Crossroads of China's UHMWPE Industry

According to statistics, China's ultra-high molecular weight polyethylene (UHMWPE) production capacity in 2025 surged by 81% compared to 2024. Currently, both inside and outside the industry, market participants are anxious about the already existing oversupply in the UHMWPE market, while also being filled with anticipation for the opportunities brought by the expansion of new downstream application scenarios. Editor believes that we should face up to the transformation the industry is undergoing while respecting the objective law of survival of the fittest. In the coming years, the UHMWPE industry will drive accelerated product iteration and upgrading through more intense market competition. By then, China's UHMWPE market will lead the global market into a new era of development...

I. Amidst the Domestic UHMWPE Investment Boom, Capacity Surges 81% Year-on-Year

Looking back at China's UHMWPE supply data over the past decade, it is evident that overall capacity growth remained at a relatively low level from 2016 to 2022. Significant changes occurred from 2023 to 2025.
Beginning in 2023, China entered a phase of major project commissioning. Capacity grew from 260,000 tons/year in 2023 to 730,000 tons in 2025, with a compound annual growth rate (CAGR) as high as 66%. In 2023, the commencement of Henan Watson's 30,000 tons/year slurry loop tubular continuous process plant marked a significant breakthrough in China's UHMWPE production technology. In 2024, the operation of Zhongying Petrochemical's 100,000 tons/year plant signaled China's entry into the large-capacity era of UHMWPE production. On October 28, 2025, Puxijing's 140,000 tons/year facility officially started production. This is currently the largest production facility in China, accounting for 19% of the total capacity alone. Based on existing operational facilities and projects planned for completion within the year, China's total UHMWPE capacity in 2025 is estimated at 730,000 tons, with a new addition of 330,000 tons within the year, representing an 81% growth rate compared to 2024. Driven by the trend towards domestic supply chain autonomy, UHMWPE capacity growth has remained high over the past three years.

II. UHMWPE Capacity in 2025 is Concentrated in Eastern Coastal Regions, Accounting for 45%

Between 2020 and 2025, capacity expansion was concentrated in North China and East China, with new capacities of 100,000 tons and 160,000 tons added in these regions respectively in 2025, accounting for 35% of the total new capacity. North China, East China, and South China are the major consumption regions for UHMWPE in China, with production facilities located close to downstream consumer markets. To facilitate raw material input and product output, most new integrated projects are sited in East China and North China. Driven by the push for integrated refining and chemical projects, and as large-scale refining facilities are completed, UHMWPE, as one of the supporting downstream products with higher profitability than general-purpose polyethylene, has seen its capacity expand accordingly. In absolute terms, East China, a hub for private enterprises, ranks first nationally in capacity. Its capacity has changed significantly, increasing by 190,000 tons over six years, reaching 330,000 tons in 2025, which constitutes 45% of the national total. Major producers in this region include Celanese, Shanghai Lianle, Jiujiang Zhongke Xinxing, Puxijing, etc.
North China holds the second-largest UHMWPE capacity nationally. As a major consumption region for downstream products like sheets, pipes, and fibers, production facilities are situated near consumer markets. In 2025, the capacity in this region is 240,000 tons, representing 33% of the national total. Key producers include Liankun New Materials, Zhongying Nangang, Yulong Petrochemical, etc. Northwest, Central, and Northeast China saw relatively minor capacity additions. South China and Southwest China had no new capacity additions in the past six years.

III. UHMWPE Capacity is Primarily Held by Private Enterprises, Accounting for 59% in 2025

Currently, China's UHMWPE capacity can be categorized by enterprise type into six major groups: private enterprises, Sinopec, PetroChina, coal chemical enterprises, joint ventures, and foreign-funded enterprises. Among these, private enterprises, leveraging strong market sensitivity and high flexibility, can quickly adapt to and respond to market demand changes, thereby securing a leading position in the UHMWPE market. Consequently, their capacity share is the highest, accounting for 59% of the total capacity in 2025. They are followed by joint ventures and Sinopec enterprises. Together, these three categories command over 80% of the market share.

IV. Rapid Development in Emerging Fields Drives Simultaneous Rise in UHMWPE Imports and Exports

From 2016 to 2025, China's UHMWPE import volume showed an increasing trend, with a CAGR of 27%. Starting in 2022, benefiting from a surge in new energy vehicle sales, Chinese upstream producers began increasing production of lithium-ion battery separator materials, such as Yangzi Petrochemical and Shanghai Lianle. This led to a slight substitution of imported separator materials with domestic ones, although a significant portion of the market is still held by Celanese and Daelim, among others. From 2023 to 2025, the rapid development of sectors like national defense modernization, military, aerospace, and aviation provided broader application scenarios for UHMWPE, promoting steady growth in imports. In 2025, import volume increased by 14% compared to 2024, reaching 160,000 tons.
China's UHMWPE export volume remained below 20,000 tons from 2016 to 2025, with relatively low exports mostly consumed within the domestic market. In 2025, China's UHMWPE export volume was 19,000 tons. It is understood that domestic producers rarely export directly; instead, most exports are handled by domestic traders who sell to overseas markets.

V. UHMWPE Consumption Increases Year by Year, with a 2016-2025 CAGR of 15%

Over the past decade, the supply in the UHMWPE industry has continuously increased, and demand has grown annually. Although demand growth has not kept pace with supply, the advancement of upstream production technology and functional modification technology, coupled with continuous upgrades in downstream product processing techniques and the extension of application scenarios, will drive the growth of UHMWPE consumption. In 2025, consumption is estimated to rise to 390,000 tons.

In segmented consumption fields, separator demand accounted for 41% in 2025, with a demand of 160,000 tons/year, ranking first. The sheet sector is mature and relatively stable, consistently being one of the largest application fields in China, accounting for 25% with a demand of 98,000 tons/year. The pipe and fiber sectors accounted for 19% and 13% respectively, with demands of 74,000 tons/year and 50,000 tons/year. The medical and other sectors together accounted for 2%.

In summary, based on data analysis of China's UHMWPE market scale over the past decade, it is evident that China is gradually shifting from the role of a "catch-up" to that of a "leader." Simultaneously, the Chinese market is transitioning from the rapid capacity expansion "catch-up phase" to the value deepening "dominance period." This transformation serves as a robust response to the phenomenon mentioned at the beginning of the article regarding China entering a major investment year since 2023. Currently, both inside and outside the industry, market participants are anxious about the already existing oversupply in the UHMWPE market, while also being filled with anticipation for the opportunities brought by the expansion of new downstream application scenarios. We believe it is essential to face up to the transformation the industry is undergoing while respecting the objective law of survival of the fittest. In the coming years, the UHMWPE industry will drive accelerated product iteration and upgrading through more intense market competition. By then, China's UHMWPE market will lead the global market into a new era of development.