Risks mount for ethylene producers as trade tensions rise

The world’s ethylene producers are facing some painful decisions in coming years. Production has expanded rapidly in North America and the Middle East on the basis that China would also need increasing imports of polyethylene (PE) and other ethylene derivatives. But in reality, China is now moving rapidly towards PE self-sufficiency. It already produces two-thirds of its own demand, up from just half in 2020 and it is still building major new domestic capacity. Where will all the new North American and Middle Eastern export-oriented capacity go?