In the past year of 2025, due to factors such as differences in foreign trade policies and repeated geopolitical rifts, the market for bulk plastics remained complex and volatile. At the same time, China's plastic industry is in a phase of expansion cycle change. Against the backdrop of a long-term slowdown in global economic growth, can the domestic general plastics industry make further progress and stabilize the market trend. This forecast report will take you ahead of the general plastics industry in China in 2026.
General plastic products mainly include polyethylene (PE), polypropylene (PP), polyvinyl chloride (PVC), polystyrene (PS), and acrylonitrile butadiene styrene copolymer resin (ABS). The core advantage of its "universal" name lies in its wide application, low price, and large output. Whether as a necessity for daily life, in industrial production, or as a financial product, it holds an irreplaceable and important position, hence it is also known as a bulk plastic variety.
The plastic market in our country has a huge consumer demand. Since the beginning of the new century, the domestic plastic industry has achieved leapfrog development, with significant progress in product types and output. Especially in the past five years, according to statistics, the total production of primary form plastics in China exceeded 1 trillion tons for the first time in 2020. From 2020 to 2024, the average annual production growth rate will remain above 5.14%, maintaining its position as one of the world's major plastic production bases with a global share of about one-third. And the just passed 2025 annual production growth has reached a breakthrough of over 11%, surpassing the forecast value at the beginning of the year.
With the increase of production capacity and output in our country, the domestic demand gap for plastics is gradually being met, and the degree of dependence on imports is also decreasing year by year. In the first 11 months of 2025, the cumulative import volume of primary form plastics in China was 24.281 million tons, a year-on-year decrease of 7.8% and reaching a new high. The cumulative import amount was 36.1623 billion US dollars, a year-on-year decrease of 9.2%. The accelerated release of new production capacity to replace traditional imports, coupled with tariff policies and trade frictions forcing a contraction in the proportion of external purchases, has made it a foregone conclusion that China's primary form plastic imports have maintained negative growth for five consecutive years. If this negative growth trend is estimated, the import volume of primary form plastics in China for the whole year of 2026 may not exceed 25.3588 million tons. However, in imported categories, the domestic substitution rate for basic plastic categories is high, while the domestic substitution rate for high-end categories is relatively low.
From the perspective of domestic downstream consumption structure, in the first three quarters of 2025, China's plastic processing enterprises produced a total of 59.373 million tons of plastic products. Among them, the film production reached 13.935 million tons, and the proportion of consumption decreased by 0.5% to 23.5% year-on-year; Next is 3.869 million tons of daily plastic products, with a decrease in proportion of 0.5% to 6.5%; The remaining nearly 70% of the plastic products market is occupied by synthetic leather, plastic weaving, building materials, and other plastic products. It is worth mentioning that the sudden rise in demand in the fields of new energy vehicles, consumer electronics, and smart homes has driven the incremental market for specialized materials. The overall distribution of consumption shows a pattern of one super strong and many strong, and industry consumption is generally healthy and stable. The fundamentals of domestic demand have shown a certain ballast effect.
Challenges and Opportunities
Potential for Demand Growth and Rapid Industry Expansion
Although the industry has been disturbed by various major factors in recent years, the downstream demand for general plastics is still moving forward with resilience amidst fluctuations. According to relevant estimates, the apparent consumption growth rate of the plastic industry in China is expected to be around 6% by 2025. The steady growth of traditional plastic product consumption in China and the opening up of the emerging plastic industry track will bring profound growth potential to the domestic general plastic industry.
At the same time, China's general plastic production capacity is still in a state of rapid expansion. Currently, China has entered the second expansion cycle of the plastic industry from 2026 to 2029. According to the summary of relevant investment and construction plans, except for PVC, the expansion rate of PP, PS, and ABS production in 2026 will be over 10%, and PE will reach as high as 27.31%. It is expected that by the end of the year, the newly added production capacity of various varieties will mostly be lower than the full year production capacity of 2025, indicating that the expansion of China's plastic industry is undergoing a shift from a "big and fast" pattern to a "stable growth" pattern.
Although the pace of expansion has relatively slowed down, judging from the performance of the plastic market in recent years, the growth rate of demand for general plastics in the domestic market does not match the production capacity. The imbalance between domestic supply and demand is gradually becoming prominent, and China's plastic market is entering a period of deepening overcapacity. The contradiction between supply and demand mismatch poses a long-term risk. It can be seen that the opportunities and challenges in terms of supply and demand in the future plastic market lie between the release of demand potential and the struggle for supply of goods, and it is expected that market competition will become increasingly fierce.
Expansion of Export Markets and Fluctuations in the Foreign Trade Environment
With the increase of domestic plastic foreign trade windows, more and more plastic companies are choosing to further explore emerging overseas markets. According to statistics, the export value of plastic products in China has reached 78.021 billion US dollars in the first three quarters of 2024 alone, and the export value for the whole year of 2023 is 100.809 billion US dollars, which has almost tripled compared to ten years ago, and has already become one of the major plastic exporting countries. This change confirms the leapfrog improvement of domestic plastics in cost control, category coverage, and supply chain matching. This wave of export expansion not only stems from the digestion of excess domestic production capacity overseas, but also benefits from the upgrading of the "the Belt and Road" infrastructure. At the same time, it superimposes the multiple dividends of the transfer of Southeast Asia's home appliance and automobile industry chain and the reduction of shipping costs, which has significantly enhanced China's regional competitiveness. Expanding export markets and hitchhiking on the growth of foreign economies is undoubtedly an emerging blue ocean field for China's plastic enterprises.
The factors causing the year-on-year decline in China's plastic product exports in 2025 are not only objective factors such as reduced external demand, but also artificial factors such as the rise of trade protectionism. Although the suspension of tariffs by China and the United States will be extended for one year in the second half of 2025, China's actions on exports to the United States can continue to increase at the current high tariff level of nearly 30-40%. Based on data from the first 11 months alone, exports of plastic products to the United States decreased by 18.3% year-on-year. In addition, tariff barriers such as the European "carbon surcharge" in the name of environmental protection and trade protection have not weakened their impact on plastic foreign trade. The uncertainty of tariff policies is expected to persist for a long time. Plastic colleagues need to overcome difficulties and provide support for domestic plastics going global.
Industrial upgrading and remote cost aspect
Since 2016, China's general plastics industry has entered a new stage of high-quality development. Plastic polymerization enterprises are paying more attention to extending into the upstream raw material field and expanding into the downstream product processing field, and the process of industrial integration is constantly accelerating. Currently, the proportion of integrated production of major plastic varieties in China has reached a huge half, and the comprehensive quality of domestic plastic enterprises has been improving year by year. This industrial integration model has advantages such as reducing production costs and strong risk resistance of enterprises.
Oil and natural gas are important raw materials and energy sources for the general plastics industry. Industrial integration has brought about cost reduction and efficiency improvement, while also deeply linking plastics with the upstream market. However, China is constrained by its resource endowment of poor oil and gas, and the cost pressure of the general plastics industry largely comes from imported oil and gas. In recent years, due to the disturbance of international geopolitical conflicts, market concerns have been fluctuating, and energy prices have fluctuated dramatically. Against the backdrop of the fluctuating geopolitical disputes between the Middle East and Europe, the domestic production and sales of bulk plastics in 2026 have become even more uncertain.
Outlook and Prediction
price forecast
According to the Commodity Market Analysis System of Shengyi Society, as of the end of 2025, the prices of the five major general plastics in China have all declined, with significant price drops compared to the beginning of the year. The current General Plastics Index is 631 points, falling below the five-year low of 653 points on April 6, 2020. Although the deep cultivation of traditional plastic product consumption is an important growth point for domestic general plastics, the performance of plastic price trends in 2025 also reflects the insufficient demand elasticity in traditional fields. At the same time, the supply environment for domestic large base production capacity is still in its infancy, and the lag in consumption growth is likely to lead to a temporary bottoming out of unit prices. Therefore, it is expected that there will be no significant recovery in the market in 2026, and the price position will continue to be relatively low.
Increasing production without increasing profits
Another situation brought about by the temporary supply-demand contradiction is that the industry increases production without increasing profits. According to data from the National Bureau of Statistics, in the first three quarters of 2025, the cumulative operating revenue of large-scale enterprises in the plastic products industry in China increased by 1.1% year-on-year, while the total profit decreased by 2.9% year-on-year. It is worth noting that in the first three quarters, the inventory of enterprises above designated size increased by 3.2% year-on-year, and the effective demand in the market is still insufficient. Taking ABS as an example, looking back at around 2020, ABS products seemed to have a unique advantage, with a period of glory and prosperity, and the polymerization plant was making money like a "lying win". Until the past three years, the profit situation has sharply declined. The unit price profit is struggling to support the cost lines of 241 yuan and -211 yuan.
The pressure of plastic companies' costs is urgently seeking to be transferred, and there is an increase in staggered production, production cuts, and shutdowns in the industry, with similar situations being more evident in the PS industry. According to statistics, the apparent consumption of PS in China is about 4.7 million tons, with an annual growth rate of only 2.2%, almost stagnant. The industry's capacity utilization rate has continued to decline from nearly 78% in 2020 to below 60% currently, which is out of place compared to the rapid capacity expansion. Although production can be tightened through industry self-regulation, other chain reactions such as increased losses, rising maintenance costs, and decreased profitability cannot be avoided. Although the domestic "anti involution" policy planned to phase out equipment that is over 20 years old in the third quarter of last year, its proportion is relatively small, and its impact is difficult to significantly improve the supply-demand structure in 2026.
Outlook for Industry Structure Adjustment
From the perspective of category added value, there is a significant lack of high-end ecology in China's general plastics industry at present. At present, some domestic plastic companies have certain production technology and scale of modified plastics, but the proportion of plastic modification applications in China is only about a quarter, and far below the global plastic modification rate of 50%. At the same time, we also see that by 2025, the demand for lightweight new energy vehicles will double the amount of modified plastics used per vehicle; The iteration of consumer electronics has spurred the demand for ultra-thin and high toughness modified plastics; In addition, specialized plastics such as antibacterial and anti fingerprint materials have opened up new incremental markets. In the face of changing demand, there is enormous potential for the modification market in China's plastic industry in the future. With the gradual completion of the large-scale production capacity construction of basic categories in domestic plastic enterprises, the focus of industry transformation and development will inevitably shift to the deep cultivation of high value-added projects such as modified plastic products.
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