POE Production Capacity Soars! 95 Million Tons Expected to Be Released This Year

In September 2025, Shenghong Petrochemical announced the successful startup and mass production of its 100,000-ton/year POE project in Lianyungang, Jiangsu, with the first batch of 320 tons of premium products being delivered simultaneously. Almost at the same time, the first shipment of 4,887 tons of ethylene was successfully received by Dingjide, marking the countdown to the feedstock startup of its 200,000-ton/year high-end POE new material project.

The year 2025 will be the "year of mass production explosion" for China's POE (polyolefin elastomer) industry.

In April, the 50,000-ton-per-year unit at Maoming Petrochemical successfully completed trial operations in one go, utilizing domestically developed metallocene catalysts and solution polymerization technology, filling a technical gap in the country. The second phase of Wanhua Chemical's 400,000-ton project in Penglai is accelerating, expected to reach a total capacity of 600,000 tons by the end of the year, with an accompanying alpha-olefin unit to achieve a core raw material self-sufficiency rate of over 80%. In June, the 100,000-ton unit at Jiangsu Hongjing began trial production, with products already certified by BYD and CATL. More notably, companies like Ningxia Baofeng and Kaixin Energy are planning a 500,000-ton capacity based on a coal-based route, while Fuhai Tangshan Petrochemical is supporting a 100,000-ton unit through methanol-naphtha coupling technology. The proposed domestic capacity under construction has exceeded 6 million tons.

The development history of China's polyolefin elastomer (POE) industry is a typical one.History of Breakthroughs in the Localization of Advanced MaterialsIt has gone through the complete process from being completely reliant on imports to technological breakthroughs and then to industrialization breakthroughs. Based on the characteristics of industry development, it can be divided into three key stages.

1. Stage of technological gap and complete reliance on imports (1998-2020)The POE market in China has long been dominated by international chemical giants. In 1998, Dow Chemical first entered the Chinese market with its "ENGAGE" brand POE, primarily used in the TPO modification field, replacing EPDM, which was previously used for PP modification. In 2003, Japan's Mitsui Chemicals introduced its "TAFMER" brand POE into the EVA shoe material modification market using a low-price strategy. In 2009, after LG Chem started producing POE, it also used a low-price strategy to penetrate the Chinese market. During this period,The import dependency is as high as 100%.In the U.S., companies (mainly Dow) hold over 50% of the market share in China, while Korean companies increased their share from 20.8% in 2017 to 38% in 2022. In 2022, the domestic POE import volume reached711,000 tons, a year-on-year increase of 11%, mainly used in high-end fields such as photovoltaic adhesive films and automotive modifications.

Phase 2: Technical Tackling and Pilot Test Breakthrough Stage (2021-2023)Faced with the "bottleneck" predicament, domestic companies have begun to focus on overcoming the three major technical barriers of POE.High carbon α-olefin (especially 1-octene) preparation technology、Research and development of noble metal catalysts Solution polymerization processIn 2021, Wanhua Chemical took the lead in completing the POE pilot test and launched several application grades. In September 2022, Maoming Petrochemical (using North China Institute of Technology's technology) and Oriental Shenghong (800 tons/year pilot plant) successively achieved successful pilot tests. At the same time, Beoy Company completed construction in December 2023.The first domestic industrialized POE unit.This marks the transition of domestic POE from the laboratory to industrialization with a production capacity of 30,000 tons/year. At this stage, the planned domestic production capacity has exceeded 2 million tons/year, but the actual industrial production scale is still less than 40,000 tons/year.

The current POE industry in China is experiencing an unprecedented wave of capacity expansion. According to the latest statistics, the total planned capacity of POE projects under construction in China has exceeded 6 million tons per year, covering more than 40 companies including Wanhua Chemical, Satellite Chemical, Zhejiang Petrochemical, and Dingjide.

The scale has already far exceeded the current global total production capacity (approximately 1.985 million tons) and is also much higher than the forecasted global POE demand for 2025 (approximately 1.2 million tons), indicating a potential risk of serious overcapacity in the future.

Table: Capacity Layout of Major POE Production Enterprises in China in 2025

China's POE industry is at a historical turning point. On one hand, companies like Wanhua, Shenghong, and Maoming Petrochemical have achieved large-scale breakthroughs, demonstrating China's technological strength in the high-end chemical sector. On the other hand, behind the 6 million tons capacity planning lies the severe risk of overcapacity and technological bottlenecks. The next five years will be a critical period of reshuffling in the industry.