42% of Global Output to 85% Self-Sufficiency: China Redefines Its Chemical Ambitions

China's chemical industry is preparing for a new phase of strategic upgrading following the release of the Proposal of the Central Committee of the Communist Party of China on Formulating the 15th Five-Year Plan for National Economic and Social Development. The document systematically outlines the sector's performance during the 14th Five-Year Plan period and sets out a forward-looking roadmap for the next five years, anchored by six major enhancements and five key breakthroughs. Together, these objectives signal China's determination to move from being the world's largest chemical producer to a globally competitive chemical powerhouse.

Strong 14th Five-Year Plan Performance: Scale Expansion and Quality Improvement

During the 14th Five-Year Plan period, China's chemical industry achieved substantial progress in both scale and efficiency. By 2024, total industry revenue exceeded 14.5 trillion yuan, representing a 45% increase compared with 2020. Over the same period, major chemical product output grew at an average annual rate of 4.6%. China maintained its global lead in the production of ten key bulk chemical products, including ethylene, methanol and caustic soda, and now accounts for approximately 42% of global output of major chemical products. This has established the world's largest and most comprehensive chemical production system.

China's competitiveness has also strengthened markedly at the enterprise level. In the 2024 global chemical industry revenue rankings, 11 Chinese companies ranked among the world's top 50, generating combined revenues of 2.1 trillion yuan, or 27.9% of the total revenue of the top 50. This scale exceeded that of US companies by a factor of 1.35 and surpassed the combined revenues of German and Japanese firms, reshaping the traditional competitive landscape dominated by Europe, the United States, Japan and South Korea.

In parallel with scale expansion, the industry made notable strides in green and intelligent transformation. Industrial water reuse rates rose to 93%, ranking first globally. Energy consumption per unit for key products such as refining and ethylene declined by 2%–6%, while comprehensive VOCs removal rates exceeded 90%. Hazardous waste standardised disposal reached 100%. By the end of 2024, China had more than 32,000 chemical enterprises above designated size, 59 smart manufacturing demonstration factories, and an automated control rate exceeding 90% for major production facilities.

15th Five-Year Plan Roadmap: Six Enhancements and Five Breakthroughs

Looking ahead, the 15th Five-Year Plan places 'high-end industrial restructuring' at the core of development, aiming to shift the industry from fuel-oriented growth to materials-driven advancement. Quantifiable targets have been set across multiple segments to address structural bottlenecks and strengthen global competitiveness.

Upgrading traditional industries. China's crude oil primary processing capacity reached 933 million tonnes per year in 2024, while demand for refined oil products is approaching a peak. The plan calls for refineries to accelerate the transition from fuel production to chemical feedstock supply, promoting differentiated development models to mitigate homogenised competition.

In the ethylene sector, capacity stood at 53.8 million tonnes per year in 2024, accounting for 23.4% of global capacity. By 2030, capacity is projected to reach 90 million tonnes per year. The plan emphasises optimisation of feedstock structures, with ethane expected to account for more than 20% by 2030 and naphtha-based feedstocks reduced to below 50%, alongside the orderly phase-out of non-compliant, high-energy-consuming capacity.

For aromatics, paraxylene capacity reached 43.37 million tonnes per year in 2024, representing 53.9% of global capacity, while PTA and PET capacities exceeded 80% of global supply. The 15th Five-Year Plan aims to further strengthen China's leadership across the PX–PTA–PET value chain by 2030 and improve feedstock self-sufficiency.

Accelerating breakthroughs in new chemical materials. By 2024, output value in chemical new materials exceeded one trillion yuan, with self-sufficiency rates above 80% for certain categories. However, reliance on imports remains in high-end products such as photoresists and electronic chemicals. The plan focuses on five strategic directions, including high-end upgrading of bulk materials, localisation of electronic chemicals, development of high-performance new energy materials, advancement of intelligent bio-based materials, and early deployment of materials for emerging fields such as artificial intelligence, humanoid robotics and low-altitude flight. The overall goal is to raise the self-sufficiency rate of critical products to 85% by 2030.

Modern coal chemical development with lower carbon intensity. China remains the world's largest coal chemical producer, with 2024 capacities of 8.23 million tonnes per year for coal-to-liquids, 7.5 billion cubic metres per year for coal-to-gas, and 13.42 million tonnes per year for coal-to-olefins. During the 15th Five-Year Plan period, development will prioritise coal-to-olefins as a competitive supplement to petrochemicals, while integrating green electricity, green hydrogen and carbon capture, utilisation and storage technologies to reduce emissions.

Outlook to 2030: From 'Large' to 'Strong'

By 2030, China's chemical industry aims to achieve global leadership not only in scale but also in profitability and technological capability. Dependence on imported high-end materials is expected to decline significantly, while a group of internationally influential enterprises and industrial parks will emerge. Traditional sectors such as refining, ethylene and aromatics are set to develop more differentiated, high-end advantages, and new chemical materials are expected to transition from follower to leader.

With targets ranging from a 42% share of global output and 14.5 trillion yuan in revenue to 90 million tonnes of ethylene capacity and an 85% self-sufficiency rate in key materials, the 15th Five-Year Plan marks a critical stage in China's chemical industry transformation. Focused on high-end development, innovation-driven growth and emissions reduction, the sector is poised to play a decisive role in reshaping the global chemical landscape.