What is the outlook for China's aromatics capacity expansion and downstream demand?

What is the outlook for China's aromatics capacity expansion and downstream demand?
China's aromatics sector is undergoing massive capacity growth through integrated refining and petrochemical projects. Among 202 major petrochemical projects tracked, planned aromatics capacity totals 37.69 million tons per year, with 19.7 million tons under construction. This wave of new capacity, concentrated in Shandong, Zhejiang, and Guangdong provinces, will significantly boost supply. However, the refining industry's overcapacity pressure is transmitting downstream, raising risks of oversupply in aromatics and olefins. Demand drivers remain diversified but stable, with PX feeding into PTA-PET-polyester textiles, while benzene and toluene serve styrene, nylon, and epoxy resin chains. The industry's future hinges on balancing new project startups with downstream consumption growth, particularly in textiles and packaging, where exports play an increasingly critical role in absorbing surplus.