SunSirs: Tight Global Supply Combined with Surging Exports Drives TDI Prices Higher

Since the start of 2026, the toluene diisocyanate (TDI) market has undergone significant changes. A restructuring of the global supply-demand landscape, coupled with a continued contraction in overseas supply and rapid growth in domestic exports, has driven TDI prices to rise sharply since March, making it a standout performer in the polyurethane sector. Based on a comparison ofSunSirs’ latest benchmark price on April 13 and data from the beginning of the month, current TDI prices are at their highest levels this year. The supply-demand imbalance remains the core driver, and prices are expected to continue rising.

I. Supply and Demand Dynamics: Global Market Shifts from Surplus to Tightness; China Emerges as the Leading Exporter

The global TDI industry has a total production capacity of approximately 3.7 million metric tons and total demand of about 2.8 million metric tons. While the market had long been in a state of surplus, the sudden shutdown of multiple overseas plants in 2026 caused a significant contraction in supply, rapidly reversing the surplus situation. China’s total TDI production capacity stands at approximately 2.06 million metric tons, accounting for over 50% of the global total. Domestic demand remains stable at around 950,000 metric tons, primarily serving durable consumer goods sectors such as upholstered furniture, coatings, and elastomers, with relatively stable demand levels.

Exports have become the primary growth driver for the domestic TDI market. In 2025, domestic TDI exports reached 550,000 metric tons, representing a year-over-year increase of approximately 50% and accounting for 60% of total domestic demand; Exports from January to February 2026 totaled 96,000 metric tons, a 25% year-over-year increase. Although the growth rate has slowed compared to 2025, the absolute increase remains substantial, with full-year export growth projected at approximately 30%. China has transitioned from a net importer of TDI to a key global supplier, and overseas market demand has become the primary driver of industry growth.

II. Price Trends: Sharp Surge Since March, with Gains Exceeding 30%

According to SunSirs monitoring, the domestic TDI benchmark price on April 13, 2026, was 20,433.33 RMB/ton, up 300 RMB/ton from early April (20,133.33 RMB/ton), representing a 1.49% increase; Compared to the price range of 15,000–15,500 RMB/ton at the beginning of March, domestic sales prices have risen by 4,933–5,433 RMB/ton in just over a month, representing an increase of over 30%. Export prices have also risen sharply in tandem; the export unit price, which was 1,900 USD/ton at the beginning of March, has now risen to 3,000 USD/ton, an increase of over 57%.

Current market quotes continue to rise, with some factories opening TDI at 26,000 RMB/ton—significantly higher than the 23,000 RMB/ton for polymeric MDI—highlighting TDI’s greater price elasticity. From a cost perspective, prices for TDI’s core raw materials have risen in tandem, further supporting high spot prices. With strong industry resistance to price cuts, prices are expected to converge toward the 26,000 RMB/ton level.

III. Core Logic Behind Price Increases: Overseas Supply Contraction + Surge in Export Demand

1. Global supply continues to tighten, with regional shortages widening

Since the beginning of 2026, multiple overseas TDI units have been shut down due to force majeure, equipment failures, and other issues, resulting in a significant reduction in global effective capacity. A sudden supply disruption of 200,000 tons/year of TDI capacity in the Middle East—where local demand stands at approximately 200,000 tons—has created a complete supply-demand gap. Additionally, a 165,000-ton/year TDI facility in India ceased operations in February, leading to severe domestic supply shortages. Coupled with India’s removal of anti-dumping duties on Chinese TDI, import demand has been fully unleashed.

Furthermore, low operating rates and increased maintenance schedules at facilities in other overseas regions have kept global supply tight, creating ample room for Chinese TDI exports—a key driver of the current price surge.

2. Surge in Export Demand and Rising Recognition of Chinese Supplies

The overseas supply gap has directly fueled a surge in Chinese TDI exports. The Indian market stands out in particular: having imported approximately 30,000 metric tons of TDI from China in 2025, imports in January–February 2026 have already exceeded 8,000 metric tons—a significant year-over-year increase—with procurement volumes expected to expand further. Traditional import regions such as the Middle East and Southeast Asia have also intensified their purchases of Chinese TDI, leaving domestic factories with a full order book.

At the same time, following years of quality improvements, the global recognition of Chinese TDI products continues to rise. With a significant cost-performance advantage, they are gradually replacing overseas sources, providing long-term support for export growth. Changes in the export sector in 2026 will be the core variable influencing TDI prices; if instability in overseas facilities worsens, export growth is expected to exceed expectations.

IV. Market Outlook: Supply-Demand Mismatch Persists, Prices Remain Elevated

In the short term, with the resumption dates for overseas facilities still undetermined, regional supply gaps will be difficult to bridge in the near term. Domestic TDI exports are expected to maintain high growth, with total demand from domestic sales and exports approaching 1.5 million metric tons. Compared to China’s domestic production capacity of 2.06 million metric tons, the supply-demand balance remains tight. Coupled with support from raw material costs and strong willingness among manufacturers to maintain prices, TDI prices are expected to remain at high levels, with further upside potential in the near term.

In the medium to long term, global TDI capacity expansion remains limited, while demand from downstream sectors such as upholstered furniture and the automotive industry is steadily recovering. Coupled with China’s continued consolidation of its export advantages, the industry is expected to shift from a historically loose supply-demand balance to a tight equilibrium. As a core raw material for polyurethane, TDI’s price elasticity will continue to become more pronounced. 2026 is expected to be a pivotal year for the industry’s recovery, with increased exports and contracting supply jointly driving the market to maintain a positive trend.

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