PX market review for the first half of 2025

Asian PX price as well as its economics, represented by PX-naphtha and PX-MX spreads, stayed weak before turning strong in the first half of 2025.

1. PX price

In the first 6 months of 2025, Asian PX price averaged $834/mt CFR China, down 19.2% from the same period of last year, while hitting high point of $904/mt CFR on Jun 19, and low point of $699/mt CFR on Apr 9 which was also the new low since Jan 28 2021.

In terms of feedstock cost, the average price of WTI crude oil futures during the same period was $67.52 per barrel, down 14.3% year-on-year, while the average price of Brent crude oil was $70.81 per barrel, down 15.1% year-on-year.

The average price of naphtha from January to June was $616.50/mt CFR Japan, a decrease of 10.2% year-on-year. The average price of MX over the same period was $731.0/mt, down 22.2% year-on-year.

Therefore, based on the price drop in the first half of the year, the price movement of PX was significantly weaker than that of crude oil and naphtha but slightly stronger than that of MX.

2. PX-naphtha and PX-MX spreads

In terms of economics, in the first half of 2025, PX-naphtha spread followed a gradual recovery trend. It remained relatively weak but stable, averaging $203/mt in the first quarter, up 8.3% quarter-on-quarter but still significantly lower year-on-year, shrinking by 40.5%.

At the beginning of the second quarter, the spread weakened again but then rebounded sharply, reaching a high of $301/mt on Jun 30-the highest level since Aug 13 2024. The average PX-naphtha spread in the second quarter was $231.6/mt, up 14.1% quarter-on-quarter but still down 34.1% year-on-year.

From January to June, the average PX-naphtha spread stood at $217.5/mt, a 37.2% decline compared to the same period last year.

From the perspective of the economics between MX and PX, the average price spread of PX-MX in USD terms during the first half of the year was $81.9/mt FOB Korea, a year-on-year increase of nearly 16%. This was mainly due to slack gasoline blending demand and lackluster Asian aromatics exports to the U.S., which put greater pressure on MX prices.

The average spread between PX and MX in Chinese yuan terms over the same period shrank by nearly 24% year-on-year to 681yuan/mt. Due to economic factors and other influences, China domestic refinery operating rates remained relatively low this year, leading to resilience in yuan MX price compared to USD-denominated MX. As a result, the PX-MX spread based on Chinese yuan narrowed.

3. PX plant operating rate

The average PX plant operating rate in Asia (including China) in the first half of 2025 was around 75.4%, up 1.5 percentage points year-on-year. Chinese mainland overall PX operating rate reached 83.2%, an increase of nearly 3 percentage points year-on-year.

Besides from planned maintenance, weaker economics-particularly a sharp decline in disproportionation profitability-along with some unplanned unit outages, led to lower operating rates in Asia (excluding China). Only January and June saw higher operating rates compared to the same period last year.

Domestically, China's PX operations remained relatively stable in the first half year. Aside from scheduled maintenance, unplanned shutdowns or production cuts due to technical issues were fewer than last year, providing some support to the operating rate. However, in March and April, due to poor profitability combined with scheduled plant maintenance, China's operating rate fell year-on-year, though it outperformed the previous year's levels in other months.

China's PX output in the first half of the year exceeded 18.5 million tons, representing a year-on-year growth of less than 1%. Over the past two years, there have been no new PX capacity additions in China, meaning production fluctuations were primarily driven by changes in operating rates.

From March to May, due to maintenance shutdowns and poor profitability, monthly PX production saw a year-on-year decline of around 3-5%. However, after May, as maintenance activities decreased and economics improved-leading some plants to postpone turnarounds or increase operating rates-domestic PX production saw a notable year-on-year rebound, with average growth of about 7%.

4. China PX imports

China's total PX imports from January to May reached 3.735 million tons, a year-on-year decline of 2.4%, data from China Customs showed.

The key factor behind the sluggish import growth was lower overall supply due to reduced overseas production amid poor profitability. For instance, some of Chinese mainland's major import sources-such as South Korea, Taiwan, Brunei, and some Southeast Asian countries-either saw declines in production and total exports or diverted some shipments to the U.S. and South American regions.

However, after March and April, weakening demand outside China led to increased PX flows into Chinese market. Then, starting in May, rising domestic demand boosted Chinese buyers' import appetite, contributing to a rebound in import volumes.

5. Supply and demand in China

Since 2024, downstream PTA and polyester capacities have continued to expand in China, while PX has seen no new capacity additions for two consecutive years, leading to a theoretical improvement in PX supply-demand fundamentals.

Although PTA maintenance activities were extensive in the first half of 2025, resulting in lower operating rates year-on-year, PTA production still increased by nearly 4% due to the expanded capacity. Polyester output grew even more significantly, by about 7.8%. Despite the obvious demand growth, China domestic PX production rose only slightly, and imports from January to May fell year-on-year. Even with the rebound in June taken into account, total PX imports in the first half year are estimated to increase by only around 3%.

Against this backdrop, PX inventories in China saw a significant reduction in the first half of 2025, with an estimated total destocking of over 450,000 tons from January to June. Given expanding downstream capacity, stronger demand for feedstock, and the fact that PX has been in a destocking trend in most months since April 2024, current domestic PX inventory levels are relatively low in China, leading to tight supply.

This tightness has driven a gradual strengthening in PX floating prices since May, with Aug spot price peaking at around $33/mt premium to formula pricing by late June, the highest level since last year.