Over the past decade, polyolefin production capacity has maintained rapid growth. Capacity expanded from 14.91 million tons of polyethylene and 17.44 million tons of polypropylene in 2015 to 39.46 million tons of polyethylene and 49.03 million tons of polypropylene by 2025, achieving average annual growth rates of 10.2% and 10.9%, respectively. Domestic polyolefin supply has gradually shifted toward a state of ease or even surplus, increasing pressure on the industrial chain.

New Polyolefin Capacity Commissioning in 2026

Relief for the polyolefin industry will largely depend on the completion of the current commissioning cycle. Looking at 2026 commissioning plans, new polyethylene capacity additions will reach 7.29 million tons, while new polypropylene capacity additions will be 5.45 million tons. Polyolefin supply will thus continue growing at a high pace. Projected nominal capacity growth rates for 2026 are 18.5% for polyethylene and 11.1% for polypropylene, with polyethylene expansion outpacing polypropylene.

Based on projected commissioning schedules, new polyolefin facilities in 2026 will predominantly come online in the second half of the year. According to available information, facilities with significant commissioning potential in the first half of 2026 include: - North China Huajin Aramco's 500,000-ton HDPE/450,000-ton full-density/1,000,000-ton PP (7664, -18.00, -0.23%), Dongming Zhongyou's 400,000-ton full-density/400,000-ton HDPE/350,000-ton PP facility, and Xinpu Olefins' 400,000-ton PP facility. The majority of remaining facilities are scheduled for commissioning in the second half of 2026. Consequently, the effective capacity growth rate for polyolefins in 2026 will be significantly lower than the nominal capacity growth rate.

In terms of production process distribution, new polyolefin capacity in 2026 will primarily originate from oil-based plants, mainly supplied by large refining and petrochemical enterprises such as North China Huajin Aramco and Sinopec-Saudi Aramco Gulei. Consequently, the progress of these major refining and petrochemical projects will significantly influence the commissioning pace of polyolefins in 2026.

Regarding polyethylene plant classifications, recent industrial restructuring and technological advancements have gradually shifted the selection criteria for new polyethylene plant commissioning. Among polyethylene plants scheduled for 2026 commissioning, full-density units account for the largest share with a planned capacity of 2.75 million tons, followed by HDPE plants at 2.05 million tons. Starting in 2025, commissioning of LDPE and LDPE/EVA plants will increase, while standard LLDPE plant commissioning slows. Some of these plants may face further delays in actual commissioning.

In 2026, the commissioning pace for LLDPE and full-density units will remain steady, with annual capacity growth projected at 19%. However, the actual effective capacity growth will be significantly lower than the nominal growth rate. While full-density units will see the most commissioning in 2026, only two projects—North China Huajin Aramco's 450,000-ton capacity and Dongming Zhongyou's 400,000-ton capacity—have a high likelihood of commissioning in the first half of the year. The remaining units are mostly scheduled for the second half of the year. Moreover, some units do not intend to primarily produce lower-end standard LLDPE but instead plan to manufacture higher-value-added products like metallocene LLDPE. Consequently, the effective capacity growth rate for standard LLDPE in 2026 is projected to be 4%, significantly lower than the 24% growth rate in 2025.

Summary

Based on the 2026 polyolefin new plant commissioning schedule, the sector remains in an expansion cycle. While polyethylene capacity growth will outpace polypropylene for the full year, most new polyolefin plants are scheduled to start production in the second half. Consequently, the effective capacity growth rate for polyolefins in 2026 will be significantly lower than the nominal capacity growth rate.

Regarding standard product capacity, the effective capacity growth of new polyethylene standard product facilities scheduled for 2026 will decelerate significantly compared to previous years, indicating relatively low supply pressure for polyethylene standard products in 2026.

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