China Mixed Xylene Output Surges in H2 2025

China's mixed xylene market in 2025 exhibited a pronounced structural shift, with output rebounding strongly in the second half of the year despite operating rates remaining below early-year levels, reflecting the impact of concentrated new capacity additions.

From a monthly production and operating rate perspective, China's mixed xylene sector recorded a 'decline-then-recovery' pattern from January to December 2025. While operating rates fluctuated throughout the year, the growth in output during the second half was significantly more pronounced. Beginning in July, monthly production surpassed the high levels seen at the start of the year. In contrast, although operating rates rebounded after a period of volatility, they did not return to their early-year peak.

The divergence between output and operating rates primarily stemmed from the concentrated commissioning of new capacity in the second half of 2025. As the overall supply base expanded, production growth outpaced improvements in utilization rates, resulting in a widening gap between the two indicators.

A particularly notable divergence occurred in June and July, when production and operating rates moved in opposite directions. During this period, multiple new units were brought online, driving an increase in total output. However, newly commissioned facilities typically operated at relatively low load levels during the initial start-up phase, which weighed on the overall industry operating rate.

Meanwhile, China's mixed xylene production-to-sales ratio showed a steady upward trend throughout 2025. Over the past five years, most new mixed xylene capacity has originated as by-product supply from PX (paraxylene) units. Large-scale, high-capacity integrated facilities have largely consumed mixed xylene internally, meaning that growth in domestic commercial supply did not fully align with capacity expansion.

In 2025, this pattern changed markedly. The growth rate of domestic commercial mixed xylene supply significantly exceeded the pace of capacity and production growth. The production-to-sales ratio climbed steadily from around 19% at the beginning of the year to approximately 23%.

This increase was primarily driven by the nature of newly added capacity in 2025, much of which was export-oriented or externally marketed. A substantial portion of new output was converted directly into commercial supply. Notably, Yulong Petrochemical's large-scale facilities experienced a mismatch in the commissioning timeline between mixed xylene and PX capacities. As a result, mixed xylene was temporarily sold into the market, contributing to a rapid rise in the production-to-sales ratio during the year.

Looking ahead to 2026, the degree of integration in new mixed xylene capacity is expected to be higher than in 2025. However, commissioning plans for several PX units remain concentrated in the second half of the year. As a result, the annual production-to-sales ratio is projected to remain broadly in line with 2025 levels, suggesting continued pressure on spot market supply. Once additional PX capacity is fully released toward the end of 2026, the production-to-sales ratio is expected to gradually decline.