Private petrochemical producers set for robust growth

China's vast private petroleum and chemical sector is positioned for robust and broad growth, industry data showed, driven by its aggressive pivot from traditional processing toward high-end specialization across the value chain.

This strategic transformation emphasizes the development of high-value specialty chemicals, new materials and green energy segments, effectively enhancing the core competitiveness of private enterprises in line with evolving market demands, according to a recently released report by the China Petroleum and Chemical Industry Federation (CPCIF).

The 2025 China Petroleum and Chemical Private Enterprise Development Report has underscored the robust performance and increasing strategic importance of private capital in one of the most critical industrial sectors of the country.

"China's vast private petroleum and chemical sector has witnessed notable progress, with its top 100 companies generating more than 5.67 trillion yuan ($788 billion) in revenue last year," said Li Yunpeng, president of the CPCIF.

"This highlights the sector's broad prospects for future growth," he said.

According to Li, the 14th Five-Year Plan (2021-25) has been an important period for historical changes in China's petroleum and chemical industry. The number of large-scale private enterprises in the industry surpassed 30,000 in 2024, accounting for over 90 percent of the total.

The combined revenue of the top 100 private players alone contributed 34.8 percent of the entire industry's revenue, with 57 of those companies reporting individual revenues exceeding 10 billion yuan, it said.

Looking ahead, the private sector is set to receive a significant boost as the forthcoming 15th Five-Year Plan (2026-30) is expected to integrate the development of the private economy into the national modernization blueprint, ensuring continued supportive policies, Li said.

The report noted a widespread increase across key metrics, including operating revenue, total exports, R&D investment and employment, signaling industrial health despite global economic volatility.

Digital intelligence technologies, including artificial intelligence and big data, are also catalyzing new growth drivers, enabling private firms to achieve breakthroughs in their modernization efforts, it said.

Amid the backdrop, global chemicals giants are also stepping up their presence in China, the world's largest chemical producer and consumer by revenue and volume.

They are maintaining their commitment to the Chinese market, viewing the world's largest chemical producer and consumer as indispensable for long-term growth.

Companies like Saudi Arabia's Aramco are strategically recognizing that future growth in the specialized and high-end chemical segments remains concentrated in the Asia-Pacific region, with China as its epicenter.

Foreign investment is increasingly targeting specialized areas such as electronic chemicals, high-performance polymers, and materials crucial for China's rapidly expanding electric vehicle (EV) and renewable energy supply chains.

This specialized demand, driven by China's national strategic goal of moving up the manufacturing value chain, is where international firms seek to leverage their proprietary technology and deep R&D expertise.

Global specialty chemicals company Syensqo said it is committed to investing in China and is optimistic about its long-term economic prospects.

Syensqo CEO Ilham Kadri highlighted China's critical role in the global chemical industry. She noted that China not only accounts for half of the global chemical output but also supports various high-value sectors, ranging from lightweight materials and electrification to connectivity and biotechnology.

China is a great market for Syensqo and for the chemical industry in general. Based on this recognition, Syensqo has set an ambitious strategic goal: to double their performance in China to meet the high and increasingly sophisticated demand in the country, the world's largest chemical market, she said.

The report also cautioned that private enterprises are also facing challenges from a shifting international market, while the accelerating digital revolution also poses a risk, with smart technologies disrupting traditional production and operational models.

To mitigate these challenges and secure sustainable growth, the report recommends that private enterprises focus on breaking through key core technologies and actively cultivating "new quality productive forces" to maintain their competitive edge.