Progress of new PP plants in the first half of 2025

As of Mar 25, the production capacity of PP granule is set to increase by 500kt/year in the first quarter of 2025, a slight decrease compared to the 650kt/year increase in the first quarter of 2024. Overall, the growth rate of PP production capacity has shown a modest decline in recent years.

Apart from the Inner Mongolia Baofeng #2, which commenced at the end of January, the Inner Mongolia Baofeng #3 unit was originally scheduled to be commenced in March. However, so far, there is no definitive news, and it is expected to be delayed until the second quarter. With the second quarter approaching, which new startups will join the market competition?

According to CCFGroup, at least 2.95 million tons per year of new capacity are planned to be added in the second quarter. However, based on historical experience, the actual commissioning timeline remains uncertain.

As shown in the figure above, the new startups in the second quarter are primarily concentrated in North China, South China, East China, and Northwest China. In terms of actual consumption regions, the new supply in North China, East China, and South China is expected to remain relatively balanced. Additionally, oil-based plants continue to dominate the new startups.

Overall, the second quarter faces significant pressure from the new PP granule production capacity. Fortunately, this period also coincides with an intensively plant turnarounds, which will help alleviate some of the supply pressure brought by the commissioning of new plants.