According to the latest January-June export data released by China Customs, domestic polyether polyols maintained a high growth rate in exports in the first half of 2025. The export volume of polyether polyols in H1 2024 was 1.1014 million tons, while in H1 2025, it reached 1.3154 million tons, a year-on-year increase of 19.43%. Among them, the export volume in June 2025 reached 219,600 tons, up 14.19% year-on-year. From January to June this year, the month-on-month export growth rates were 21.71%, 28.80%, 11.06%, 14.15%, 32.10% and 14.19% respectively.
Polyether prices remained sluggish in H1 2025, but flexible foam polyether prices rebounded significantly after entering Q3. According to data from Longzhong Information and other sources, the average price of domestic flexible foam polyether was 9,867 yuan/ton in 2023 and 8,911 yuan/ton in 2024. After entering 2025, prices declined significantly: the average prices in Q1 and Q2 2025 were 8,190 yuan/ton and 7,366 yuan/ton respectively, remaining sluggish in the first half of the year. However, since the start of Q3, flexible foam polyether prices have rebounded obviously: the average price in July 2025 was 7,617 yuan/ton, and as of August 13, 2025, the average price in August reached 8,306 yuan/ton, up 3.41% and 12.75% respectively compared with the price in Q2 2025. POP polyether has also shown signs of price stabilization and rebound recently. The average price of domestic POP polyether was 9,987 yuan/ton in 2024, 9,341 yuan/ton in Q1 2025 and 8,556 yuan/ton in Q2 2025, with prices in H1 2025 dropping significantly year-on-year. The average price in July 2025 was 8,475 yuan/ton, and as of August 13, 2025, the average price in August was 8,547 yuan/ton, indicating that relevant prices have basically stabilized.
Frequent overseas production capacity withdrawals have led to significant growth in domestic exports. Since the second half of 2024, affected by factors such as persistently high operating costs and unexpected accidents, multiple overseas polyether polyol plants have suspended or interrupted supplies. These include Dow Chemical's shutdown of its 50,000 tons/year production capacity in Argentina; in March 2025, LyondellBasell and Covestro jointly decided to close their PO/SM plant in the Netherlands, which is expected to have a significant impact on local downstream polyether raw material supply; in July 2025, Covestro declared force majeure on TDI and polyether polyol products at its Dormagen site in Germany. From the perspective of China's exports to different overseas markets in H1 2025, exports to Turkey, India, Vietnam, the United Arab Emirates and Russia were 135,000 tons, 135,000 tons, 117,000 tons, 60,000 tons and 52,000 tons respectively, with year-on-year growth rates of 0.13%, 59.00%, 55.04%, 0.10% and -16.87% respectively. Exports to India and Vietnam markets grew significantly in the first half of the year.
Investment Recommendations: The demand for the polyether industry is strongly supported by overseas demand, and the competitive advantages of domestic enterprises over overseas enterprises have become increasingly prominent. We are optimistic about the growth potential of the domestic polyether industry. Key targets include: (1) Longhua New Materials: an important domestic polyether manufacturer, mainly producing flexible foam polyether and POP polyether; (2) Wanhua Chemical: a leading supplier of polyurethane and basic chemical products, and one of the largest domestic manufacturers of flexible foam and rigid foam polyether. We are optimistic that the recovery in the prosperity of the polyether industry will drive the performance of the above-mentioned companies.
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