In 2025, the phenolket industry faces a critical year for structural adjustment. The policy direction is "anti-internalization," clearly promoting the industry's transition from low-price competition to high-quality development; the production capacity is characterized by a "new and old rotation," with new capacities being released in succession and outdated capacities being phased out simultaneously; market supply and demand imbalance has intensified, leading to deep price declines, putting pressure on industry profitability; technological innovation focuses on green and low-carbon use, with an increasing trend towards industrial chain integration. Here are the annual core events:

1. Policy Leading Transformation: Environmental Protection and Anti-Internalization Policies Drive Transformation - At the beginning of the year: China's environmental standards were upgraded and implemented, with the newly revised "Petrochemical Industry Volatile Organic Compound Emission Standards" officially in place in 2025, mandating VOCs emission control requirements for phenolket production enterprises, forcing small and medium-capacity enterprises to upgrade their environmental protection devices, and raising the industry access threshold further. Simultaneously, the "Structural Adjustment Guidance Catalog (2024 Edition)" was issued, specifying the elimination standards for outdated phenolket industries (mainly those with more than 20 years of operation and less than 300,000 tons/year), delineating clear red lines for industry structural optimization.

• In March: During the national两会, discussions centered on chemical industry anti-internalization, with a call for phenolket industry to achieve efficient and intensive development through supply and demand matching and structural upgrading, with dual driving forces of policy guidance and market mechanisms establishing a supply-side optimization model gradually.

• Through the year: EU REACH regulations increased compliance requirements, adding four new phenolket derivative substance restrictions, imposing stricter requirements on the supply chain traceability and carbon footprint certification of phenolket derivatives, prompting domestic export-oriented phenolket companies to accelerate the construction of compliance systems to deal with green trade barriers.

2. Production Capacity Pattern Reconstruction: New Capacities Released Synchronously, Old Capacities Phased Out - In the first half of the year: Fuyu Petrochemical's phenolket unit was put into operation as the first batch of new capacities in 2025, significantly expanding China's total phenolket capacity to over 10.48 million tons/year, further highlighting the loose supply side of the market.

• In June: Yanshan Petrochemical and Jilin Petrochemical's aging units formally exited, with no restart plans for units that had been operating for more than 20 years, reducing the proportion of outdated capacities below 7.54%, bringing the proportion of old capacities below 7.54%.
• In July: Zhejiang Petrochemical's large phenolket unit successfully produced qualified products, boosting China's phenolket capacity to over 11.26 million tons/year, enhancing the regional capacity cluster effect in East China.
• By the end of the third quarter: Jilin Petrochemical's new 350,000 tons/year phenolket unit was put into operation, directly increasing the supply pressure in Northeast and North China regions, with the industry's operating rate rebounding to about 75%.
• By the end of the year: Many units were shut down for long periods, including Zhonghai Sheel, Huizhou Zhongxin I, and Gaoqiao Petrochemical, totaling 890,000 tons/year of shut-down capacities, offsetting about 460,000 tons of newly added capacities, leaving no significant increase in supply pressure.

3. Market Fluctuations: Deep Price Declines, Profit Margins Continue to Shrink - In June and July: Main core phenolket units underwent scheduled maintenance, causing short-term supply tightening. Wanhua Chemical's 650,000 tons/year, Shanghai Xisa's 560,000 tons/year, and Sinopec's Triangle Oilfield's 400,000 tons/year units were among them, with Wanhua Chemical's maintenance period lasting up to 45 days, temporarily reducing market supply and leading to a temporary stabilization of phenol prices.

• From October to December: Phenol prices reached a five-year low, falling by more than 15%. In late December, the phenol market entered a deep adjustment period, affected by newly added capacities, weak downstream demand, and weakening raw material prices, with Eastern China phenol prices decreasing by 15.44% in aggregate, reaching a five-year low, with the average price for the year dropping by 13.44% compared to the previous five years.

4. Technological and Industrial Upgrades: Innovation Focused on Green and Efficient Use, Integrated Models Becoming Mainstream - Through the year: Patent applications grew steadily, with focus on catalyst modification, wastewater treatment, low-energy consumption processes, and secondary product comprehensive utilization becoming hot topics, direct oxidation process popularity increased, and emerging catalyst system applications rose to 30%.

• Within the year: Leading enterprises accelerated industrial chain integration layout - Several leading enterprises in Yangtze River Delta integrated the entire "phenol-propylene-bisphenol A-polycarbonate" industrial chain, some also constructed photovoltaic power stations to achieve energy cost reduction by 15%, adopting differentiated competitive strategies against market pressure.
• Through the year: Emerging application fields expanded rapidly - High purity phenolket products became more prevalent in new energy battery encapsulation materials, electronic grade phenolic resin, special epoxy resins, and other fields, with medical disinfection area penetration rates rising by 12% compared to 2023, becoming a new point of growth in demand.

5. Trade Pattern Adjustments: Export Orientation Enhanced, Regional Trade Network Deepened - Through the year: China's phenolket exports steadily increased, driving export-oriented development, with China's phenolket expected exports surpassing 850,000 tons in 2025, mainly flowing to Southeast Asia and the Middle East, gradually transitioning from net importers to regional exporters.

• By the end of the fourth quarter: Import supplementation intensified domestic supply pressure - Eastern China phenol import ships continuously arriving at ports, with the total arrivals in December reaching 49,700 tons, although port inventory stabilized temporarily, subsequent inbound ship cargoes are expected to continue suppressing market prices.
• By the end of the year: Regional trade trends highlighted - Asian internal phenolket trade network became increasingly close, Europe's reliance on old units climbing to 35%, global supply chain layout shifting towards regionalization and nearshoreization, sea transport costs and green trade barriers becoming key factors affecting trade flow.

In summary, in 2025, the phenolket industry faced a critical year for structural adjustment under policy guidance, with production capacity expansion and elimination proceeding hand in hand, market supply and demand imbalance leading to deep price declines, putting pressure on industry profitability. Future, technological innovation, industrial chain integration and green transformation will become the core directions for achieving "anti-internalization", "high-quality development", and achieving breakthroughs in "internalization", and realizing high-quality development.