China PX production and imports rise simultaneously

With the Spring Festival approaching, China's polyester companies have successively announced maintenance plans before and after the holiday. According to current plans, overall polyester operating rates is expected to see an evident decline in late January.

As for PTA, though the overall operating rate has increased rapidly from earlier 73% to 78% in early Jan, it is anticipated to fall back to around 73% by mid-Jan, as two units with combined capacity over 4.8 million mt/yr are scheduled for maintenance and some unit has postponed the restart.

Therefore, from a demand perspective, polyester is gradually entering a seasonal downturn, and due to the drag from demand, PTA operating rate is expected to remain at a relatively low level.

For PX, the consistently high profits in the earlier period have effectively driven an increase in industry operating rates. Currently, the PX operating rate in Chinese mainland has risen to a record high, and operating rate in other regions of Asia have also climbed to the highest levels since early January 2024.

With the increase in operating rates, China domestic PX supply is expected to rise significantly. In addition to record-high domestic production, import volumes are also projected to see a notable increase.

For December 2025, current market research suggests China PX imports may reach around 950,000 metric tons, with some logistics data even indicating imports potentially exceeding 1 million metric tons. But due to differences in customs statistical standards, the final customs data may vary slightly.

However, the increase in overseas PX operating rates in December, coupled with temporary production cuts and reduced operating rate at some PTA plants outside China due to weak sales, which led PTA producers to resell Dec PX to Chinese market, would result in a significant rise in China PX imports in Dec from the month earlier.

Based on current maintenance plans, the overall production losses outside China from January to March 2026 are expected to be lower than the same period last year, with a significant reduction compared to the fourth quarter of 2025. Additionally, overseas PX plants plan to further increase their operating rates from mid-to-late January through February. Therefore, China PX imports in the first quarter are likely to rise to an average monthly level of 900,000 metric tons.

If China domestic PX production and import volumes are projected based on current maintenance plans, it is estimated that PX supply in the first quarter of 2026 would require polyester plants to keep operating rate at 95%, to consume that amount of PX supply. However, the estimated average polyester operating rate in China for the first quarter is around 88%. This implies that significant inventory accumulation is expected in PX and PTA segments during the first quarter.

Coupled with PX inventory buildup of around 300,000 metric tons from November to December 2025, these surplus stockpiles will greatly alleviate the market's previously anticipated supply tightness due to seasonal maintenance in the second quarter of 2026.

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