November 04, 2024 – The global bottle-grade PET industry is undergoing a significant transformation, with its focal point gradually shifting from Europe and the United States to Asia. As the industrial restructuring deepens, Asia has emerged as a hub for new and expanded bottle-grade PET projects. Despite limited growth in global polyester bottle chip capacity in 2023 due to the phase-out of some outdated production facilities, China’s share of domestic capacity reached a high of 38%, highlighting its crucial role in the global bottle-grade PET industry.
The bottle-grade PET market has experienced significant fluctuations in recent years due to international oil price volatility and supply-demand dynamics, resulting in a cyclical downturn for the industry. Against this backdrop, some European and American companies have chosen to sell off or shut down their PET production facilities, while Asian companies, particularly large vertical integration enterprises in China, have continued to expand their scale. The size of China’s top ten enterprises in the world is constantly expanding.
China’s performance in bottle-grade PET exports has been particularly impressive. As the largest producer and consumer of bottle-grade PET, China has seen a substantial increase in bottle chip exports in recent years, with nearly 40% of domestic bottle-grade PET production being exported, accounting for nearly 40% of the total global bottle-grade PET trade. Notably, as countries have imposed more anti-dumping duties on Chinese bottle-grade PET, export trade flows have begun to change, with exports from other regions in Asia increasing and main export destinations shifting towards Europe.
Since 2019, domestic bottle-grade PET capacity has been increasing year by year. Between 2022 and 2023, domestic capacity grew rapidly, with several companies bringing new facilities to the market, adding a total of 4 million tons of capacity. In 2024, multiple companies are expected to join the ranks of those commencing production and expanding capacity, with a total of 2.22 million tons of new capacity. Currently, there are four domestic bottle-grade PET enterprises with a capacity of over 1 million tons, accounting for 79% of the total domestic capacity, and market competition is increasingly fierce.
In terms of production, domestic bottle-grade PET production has also shown a year-on-year increase. In 2023, domestic bottle-grade PET production reached 13.1893 million tons, an increase of nearly 19% compared to the same period last year. With the continuous increase in capacity, domestic bottle-grade PET exports have also reached new highs. In the first half of 2024, bottle chip exports reached 2.7502 million tons, an increase of 528,100 tons or 23.77% compared to the same period last year. The main export regions are still in Asia, but there is growing demand from the Russian market, and the European market is gradually expanding.
In contrast, domestic imports of bottle-grade PET have shown a trend of decreasing year by year. With the oversupply and saturation of domestic capacity, import volumes have gradually declined. In the first half of 2024, domestic imports of bottle-grade PET were only 25,400 tons, a decrease of 1.93% over the same period. Imports for the whole year are expected to continue to decline, and China’s imports of bottle-grade PET still mainly come from South Korea, Japan, and Taiwan, China.
Finally, in terms of downstream demand, domestic bottle-grade PET is mainly used in beverage and non-beverage packaging. Among them, the soft drink industry accounts for the largest share, reaching 42%. With the continuous expansion of export markets, the export demand for bottle-grade PET has also become an important part of its downstream demand.