1. Decades of quick expansion for Chinese Petrochemical industry.
2. Demand couldn’t catch up with capacity growth.• China is the biggest petrochemical player in the world after 3 rounds of development.
• Speed up currently to meet 2030 carbon peak target.
• Key drivers: demand, pursuing of GDP, aggressive private companies etc.
• Domestic demand growth slowdown: industry restructuring, Real estate industry and urbanization slowdown
• Shrink of export: economy recession, politics issue and global trading barriers.
• China demand was weak in 2022 and is expected to recover in 2H 2023.
3. Inevitable throes after rapid development
• Super surplus, low end product and fierce competition.
• Environment pollution.
• Rationalization and upgrading were the main theme in 13th Five-Year Plan.
4. China Petrochemical industry outlook under sustainability policy
• Dual- carbon target is current dominant strategy.
• The super surplus will remain within short term.
• Petrochemical supply side revolution will continue implied by the 14th Five-Year plan
• Competitive, efficient, green, upgraded chemical industry is the target.