Global Steam Cracker Closure Threat
The global ethylene industry is facing one of its most severe downcycles in decades, marked by chronic oversupply, eroding margins, and growing rationalisation pressures. This white paper, Global Steam Cracker Closure Threat, explores the structural challenges driving widespread closures and the regions most at risk.
Using Wood Mackenzie’s Ethylene Asset Benchmarking Tool, the company's analysis identifies 113 of 336 global assets, representing 27% of global ethylene capacity in 2025, as having some level of closure risk, with Asia and Europe disproportionately impacted. These risks are assessed across three tiers, incorporating financial performance, strategic asset importance, and national policy trends.
China’s aggressive capacity expansion has drastically shifted global dynamics, triggering a sustained period of oversupply. With returns on ethylene-HDPE investments projected to hit -11% in China by 2026, the country is now enforcing tighter environmental regulations and phasing out inefficient plants. This is accelerating closure risks not just within China, but also across its traditional trading partners in Japan, South Korea, and Southeast Asia.
Europe, meanwhile, is contending with weak demand, high energy costs, and increased import competition, further exacerbated by geopolitical uncertainty and decarbonisation mandates. By 2028, the region is projected to see up to 25% of its ethylene capacity either closed or up for sale.
This white paper provides a comprehensive overview of the global steam cracker landscape through 2030, offering key insights for industry stakeholders navigating one of the most turbulent periods in ethylene market history.
Download the white paper to learn more.