Asia-Pacific’s Growing Polyurethane Production: China at the Forefront

Regional Overview

Asia‑Pacific continues to be the hub of the global polyurethanes industry, supported by its extensive manufacturing base, integrated chemical supply chain and expanding downstream sectors. As per IAL’s latest study in 2026, the region remained the largest polyurethanes products market, with output rising by 1.5% year‑on‑year. China accounted for approximately 74% of regional production, while India consolidated its position as the second-largest producer, overtaking South Korea for the third consecutive year. South Korea remained an important regional producer, supported by its established automotive and electronics industries.

Growth across countries was uneven. In Indonesia, India, and Sri Lanka registered some of the strongest gains, while mature markets such as Japan and Taiwan experienced slower expansion due to weaker economic conditions and their own maturity.

At the product level, elastomers remained the largest category in Asia‑Pacific in 2025, accounting for approximately 38% of total output, driven by synthetic leather, footwear and spandex industries. Flexible foam and rigid foam each represented around 20% of production, supported by demand from furniture, bedding, automotive seating, refrigeration and construction. Coatings, adhesives, sealants and binders accounted for smaller shares of the regional output.

Raw material prices across Asia‑Pacific remained under pressure in 2025 due to subdued Chinese demand, excess supply, periodic plant shutdowns and fluctuating feedstock costs, keeping MDI, TDI and polyol prices competitive. Demand from automotive, construction, furniture, appliances, footwear, textiles and electronics provided a broad and resilient base, while strong export activity helped offset weaker domestic consumption.

Country Highlights

In 2025, China produced nearly 10 million tonnes of polyurethane, with India, South Korea, and Japan following with volumes that were only a small fraction of China's. Despite weaker domestic demand and broader economic headwinds, China retained its position as the dominant force in polyurethanes production. Output rose by 0.8% year‑on‑year, underpinned by the country’s extensive manufacturing base and highly integrated supply chain.

Substantial investment in upstream raw materials such as MDI, TDI and polyols continues to support China’s cost competitiveness and supply chain. Recent projects include Wanhua Chemical’s expansion of TDI capacity, Covestro’s world‑scale MDI train at Shanghai site, BASF’s ongoing polyols and MDI expansions in Shanghai and Chongqing, Jiangsu Eastern Shenghong’s multi‑billion‑yuan investment in new TDI and HDI facilities, and BASF’s continued development of its integrated Zhanjiang Verbund site. Together, these investments reinforce China’s position as the anchor of Asia‑Pacific polyurethanes production.

India further consolidated its role as the region’s second‑largest producer in 2025. Rapid urbanisation, infrastructure development and expanding consumer industries such as refrigeration, housing and automotive continue to underpin India’s growth, positioning it as one of the fastest‑growing polyurethanes markets in Asia‑Pacific, with forecast expansion above the regional average.

Growth Rate by Country, 2025

Source: IAL Consultants

South and Southeast Asia also showed stronger momentum, with Indonesia, India and Singapore recording notable growth, while Vietnam and Pakistan achieved steady increases. In contrast, in East Asia, Japan and Taiwan faced slower growth due to weaker domestic conditions and mature end‑use markets.

China’s Product Mix

China’s dominance in Asia‑Pacific polyurethanes production is reflected not only in production volumes but also in the product mix. The following chart shows China’s production by product type for 2025 & 2030.

China Polyurethanes Production, By Type (%)

Source: IAL Consultants

In 2025, China’s polyurethanes market was dominated by elastomers, which accounted for 45% of output, reflecting strong demand from synthetic leather, footwear and spandex industries. Rigid foam held a 19% share, driven by refrigeration and construction, while flexible foam contributed 15%. Coatings represented 13%, adhesives and sealants 8%, with binders negligible.

By 2030, the product mix is expected to remain broadly similar, though elastomers are projected to rise to 47%, while rigid foam is forecast to ease to 18% amid slower growth in real estate construction and insulation. Flexible foam, coatings, adhesives and sealants are anticipated to remain stable, underscoring the largely steady composition of China’s polyurethanes industry. The relatively stable product mix in 2030 highlights that continued investment in footwear, textiles and synthetic leather will sustain elastomer demand, while weaker construction activity will affect rigid foam growth.

China’s Share of Regional Output

China’s share of regional polyurethanes output remains largely unchanged through 2030, keeping its dominance even as India and Southeast Asia expand. The following chart shows how China’s share is projected to evolve between 2025 and 2030.

 China’s Share in Asia Pacific Polyurethanes Production, 2025 & 2030 (%)

Source: IAL Consultants

China will remain the dominant producer of polyurethanes in Asia‑Pacific through 2030, though its share is forecast to ease from 74% in 2025 to 73% in 2030. The modest decline reflects faster expansion in India and several Southeast Asian markets rather than a contraction in China's production. China’s integrated supply chain, extensive manufacturing base and large domestic market will ensure it retains its role as the anchor of Asia‑Pacific production throughout the forecast period.

Outlook

Asia‑Pacific remains the cornerstone of global polyurethane production, with China accounting for nearly three‑quarters of regional output in 2025 and retaining its dominance through 2030. At the same time, growth is shifting towards India, Bangladesh and Southeast Asia, driven by rising manufacturing investment, rapid urbanisation and expanding consumer industries, while mature markets such as Japan, South Korea and Taiwan are likely to record only modest gains. Regional output is projected to expand at a CAGR of around 3% through 2030, reinforcing Asia‑Pacific’s position as the global hub of polyurethane production.

Source: IAL Consultants

IAL is pleased to announce the publication of its latest study, Polyurethanes Chemicals and Products in Asia Pacific (APAC) – 14th Edition. This comprehensive report/data provides an in‑depth analysis of the region, covering individual country markets, end‑use applications, and an inclusive review of raw material trends.

For more information, please contact ial@brggroup.com

IAL Consultants (A Division of BRG Enterprise Solutions Ltd)

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www.ialconsultants.com