China PE plant maintenance and capacity expansion schedule in 2024

As 2023 is coming to an end, the current market remains in a state of volatility. In terms of supply, most of the PE plants are operating normally, with limited plants shut for maintenance. The overall domestic supply is relatively limited. In addition, the price spread between RMB market and CFR China market is relatively balanced. Even with occasional fluctuations in exchange rates, the CFR China market tends to self-adjust. The fluctuation in imports arrived is also relatively small. On the demand side, downstream sectors of PE, such as agricultural film, are currently in the off-season. Apart from some large factories maintaining essential production, many small factories have already halted operations. From a fundamental perspective, there is generally an oversupply situation due to insufficient demand. So, what is the supply outlook for 2024?

1. China PE plant maintenance plan in 2024

Currently, there are still many petrochemical plants that have not made clear plans. It is known that the number of plants shut for maintenance is relatively limited. However, from the figure above, the maintenance time for each plant is relatively dispersed, with a relatively high number of plants undergoing maintenance in March, which is in line with the expected spring maintenance schedule in previous years. Subsequent plants shut for maintenance are slightly dispersed, but it cannot be ruled out that there are other maintenance plans.

2. China PE capacity expansion schedules in 2024:

In 2024, it is currently known that there are plans to add a total of 5.93 million tons of PE plants and 200,000 tons of UHMWPE plants, as detailed in the figure below:

If the above plants can be put into production as scheduled, China's total PE production capacity will increase by approximately 19.2% (including UHMWPE). There is also a significant probability of delays for several new start-ups.