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330,000-Ton Capacity Expansion: Longhua New Materials Becomes China's No. 2 Polyether Polyol Producer
10 Jun 2025
330,000-Ton Capacity Expansion: Longhua New Materials Becomes China's No. 2 Polyether Polyol Producer
Keywords
The Ecology and Environment Bureau of Zibo City, Shandong Province, has officially approved Shandong Longhua New Materials Co., Ltd.'s 330,000-ton/year polyether polyol expansion project. According to the approval documents, the project will proceed as planned, including the proposed production processes, scale, site selection, and pollution control measures.
Project Details
- Total investment: 150 million yuan
- New capacity: 330,000 tons/year, including:
- 200,000 tons/year 76EK high-activity soft foam polyether polyol
- 40,000 tons/year ED28 high-activity soft foam polyether polyol
- 30,000 tons/year 305 elastomer polyether polyol
- 60,000 tons/year 204 elastomer polyether polyol
- Construction period: January 2025 - June 2026
Capacity Leap: Now China's Second-Largest Producer
As a leading manufacturer of polyether polyols, polyamide resins, and other advanced materials, Longhua New Materials currently operates:
- 600,000 tons/year polyether polyol
- 320,000 tons/year polymer polyol
- 40,000 tons/year amino-terminated polyether (with another 40,000-ton expansion planned).
Once the new project is completed, Longhua's total polyether polyol capacity will reach 930,000 tons/year, surpassing competitors like Hongbaoli and securing its position as China's second-largest producer, trailing only industry leader Wanhua Chemical.
Market Background: Polyether Polyol & Polyurethane Demand
Polyether polyol is a key raw material for polyurethane (PU), widely used in:
- Soft foam (mattresses, sofas)
- Rigid foam (building insulation)
- Elastomers, adhesives, and coatings
With China's rapidly growing PU industry, domestic demand for polyether polyol continues to rise, driving capacity expansions.
Industry Landscape: Local Leaders vs. Global Giants
China is now the world's largest producer and consumer of polyether polyols, dominated by local players like Wanhua Chemical, Longhua New Materials, and Hongbaoli.
- Wanhua Chemical, the top supplier, leverages its integrated propylene oxide (PO) supply chain to cover soft foam, rigid foam, high-resilience, and specialty polyethers.
- Competitive dynamics:
- Leading firms compete via scale and vertical integration.
- Smaller players focus on specialty products (flame-retardant, low-VOC, bio-based polyethers).
- International giants (Covestro, BASF) still dominate the high-end market, but Chinese substitution is accelerating.
Market Pressures: Overcapacity & Price Declines
Recent capacity expansions have intensified competition in mid-to-low-end markets, pressuring prices:
- May 2025 average soft foam polyether price: 7,237 yuan/ton, down 2.53% MoM and 21.2% YoY—a record low.
Future Outlook: High-End & Green Transformation
China's polyether polyol industry has entered a mature phase, facing challenges in high-end and sustainable development:
- Winners: Companies with core tech and full supply chains.
- Growth drivers: Specialty polyethers, bio-based polyols for automotive, construction, and new energy applications.
Disclaimer: Blooming reserves the right of final explanation and
revision for all the information.