China MTBE Supply to Rise with Unit Restart and New Capacity
Given MTBE unit profits improving, some overhauled MTBE units were restarted in succession with the MTBE capacity of 2,970kt/a. Besides, some newly added MTBE capacity may be gradually put into use.
The operating rate of the MTBE industry declined notably in H2 2024 with negative profits.
Entering H2 2024, China’s MTBE prices dropped notably, intensifying the cost pressure on producers. Accordingly, some MTBE producers shut units down or cut unit operating rates, dragging down MTBE unit operating rates at sample enterprisers. Overall, the operating rate of the MTBE industry in H2 2024 dropped notably YOY.
Overhauled MTBE units were restarted in succession with profit improvements.
China’s MTBE prices rebounded at the end of 2024, so profits from producing MTBE recovered dramatically. Some overhauled MTBE unit were restarted. With the MTBE unit restart, China’s MTBE output rose notably.
Besides, China’s MTBE capacity may further improve. China’s newly added MTBE capacity may increase and then trend flat from 2025 to 2029 with the five-year average growth rate of about 5.90%. It is estimated that the newly added MTBE capacity may be 5,895.5kt/a and 1,704.5kt/a in 2025 and 2026 respectively, and China’s MTBE capacity may total 34,000kt/a in 2026. No new unit is heard after 2026, so it is predicted that China’s MTBE capacity may remain unchanged.
From the perspective of the production process from 2025 to 2029, MTBE capacity through the gas separation process is expected to increase by 2,950kt/a, taking up 37% of the total new capacity, mainly due to the new capacity brought by the refining and chemical integration and ethylene units. MTBE capacity through the isobutane dehydrogenation technology is expected to increase by 4,380kt/a, occupying 54% of the total new capacity. It is mainly because the healthy profit attracts the investment in new projects. MTBE capacity through the PO/MTBE technology is expected to increase by 742kt/a, occupying about 9% of the total.
It is expected that 70% (4,130kt/a) of the planned new capacity in 2025 may come online. Integrated enterprises have many top-down processes when starting up the units, and time is long, which affects the actual commissioning progress of the MTBE unit. In addition, some MTBE enterprises face certain financial pressure, which also affect the progress of their unit construction to a certain extent.
Since China’s MTBE industry is already in a state of serious overcapacity, the investment and construction of new capacity in the future may further intensify the pace of domestic capacity elimination.
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