China's ethanolamines industry is poised for a year of transition in 2026, characterized by simultaneous growth in supply and demand, and a shift into a destocking phase. After undergoing an adjustment cycle in 2024-2025 following concentrated new capacity commissioning and rapid output growth, the industry is entering a more balanced but still challenging period. This blog delves into the key trends shaping the ethanolamines market in 2026, including production forecasts, downstream consumption dynamics, and the evolving supply-demand balance.
I. China's Ethanolamine Output Expected to Grow Slightly in 2026
The 2024-2025 period marked an adjustment phase for China's ethanolamines industry, coming on the heels of concentrated new capacity launches and robust output growth. In 2025, amid oversupply and prolonged losses, plant operations were highly volatile. Larger integrated facilities—equipped with upstream ethylene oxide units—generally maintained high operating rates to ensure balanced production and sales within their integrated industrial chains. In contrast, smaller plants and those reliant on purchased feedstock adopted more flexible operational strategies, adjusting output in response to market conditions.
Domestic ethanolamine output in 2025 reached 737,000 tons, a marginal decrease of 0.4% compared to 2024. Figure 1: Monthly Ethanolamine Output and Capacity Utilization Rate Comparison (2025-2026) (10,000 tons)
*Data Source: "Longzhong Information Ethanolamine Market Annual Report 2025-2026". For more details and data, please subscribe to the relevant product annual reports for 2026.*
Looking ahead to 2026, China's ethanolamine output is projected to edge up to 750,000 tons. Capacity dynamics will be shaped by two key developments: the commissioning of one new 100,000 tons/year plant and the exit of a 60,000 tons/year facility, bringing total industry capacity to 1.017 million tons/year. The overall industry capacity utilization rate is expected to remain stable at around 74%.
This stable utilization rate can be attributed to two primary factors: the industry is currently in a saturated state, and persistent losses have led some small-scale, high-cost plants to maintain flexible operation or shutdown statuses. As a result, while overall operating rates are unlikely to see significant fluctuations, output will register a modest year-on-year increase driven by the new capacity additions.
II. Ethanolamine Downstream Consumption Expected to Grow Slowly in 2026
Downstream consumption of ethanolamines in China is forecast to maintain slow and steady growth in 2026, with total consumption projected to rise by 3% year-on-year to 740,000 tons. Figure 2: Forecast of Ethanolamine Downstream Consumption and Total Export Volume (2025-2026) (10,000 tons)
A closer look at key downstream sectors reveals a mixed demand landscape:
Ethylenamines: This is the only major downstream sector with confirmed new capacity in 2026, specifically a 42,000 tons/year addition. However, the ethylenamines sector itself is plagued by oversupply, meaning that even with new capacity online, operating rates will remain relatively low. This will limit the potential for significant growth in ethanolamine feedstock consumption.Diethanol monoisopropanolamine (DEMIPA): Demand for ethanolamines in this segment is expected to see a slight uptick, driven by overseas market demand and DEMIPA's role as a substitute for triethanolamine (TEOA).Other sectors: Consumption growth in areas such as cosmetics, metalworking, and surfactants will primarily be fueled by ethanolamine's price competitiveness. During periods of low ethanolamine prices, it can replace higher-priced raw materials in these smaller-scale applications, thereby boosting consumption.
III. Domestic Ethanolamine Oversupply Trend to Persist in 2026, but Supply-Demand Gap to Narrow
In 2026, the ethanolamines industry will continue to grapple with oversupply, although the supply-demand gap is expected to narrow compared to previous years. The coexistence of new capacity additions and exits will drive output growth, while downstream new capacity will contribute to a modest increase in demand. Nevertheless, the supply-demand imbalance will remain a key price driver throughout the year.Figure 3: Forecast of Monthly Ethanolamine Supply-Demand Balance in 2026 (10,000 tons)
*Note: The monthly supply-demand balance forecast for 2026 is derived from comprehensive calculations, based on domestic new capacity additions, planned plant maintenance schedules, historical monthly output and maintenance-related production loss fluctuations, as well as assessments of actual domestic consumption and import/export data.*
A monthly breakdown of the 2026 supply-demand outlook reveals distinct seasonal trends:
January-February: Demand will be sluggish due to the Chinese New Year holiday period. The market will be in an oversupply phase, with a positive and expanding supply-demand gap, leading to a slight downward pressure on prices.Around April: Some ethanolamine plants will enter maintenance, tightening supply. Concurrently, demand will pick up, causing the supply-demand gap to shrink and turn negative, which is expected to push prices upward.June-July: Terminal industries will enter their traditional off-season, leading to a significant drop in downstream demand. The supply-demand gap will widen again to a relatively high level, resulting in inventory accumulation and exerting negative pressure on prices.August: Terminal industries will remain in the traditional off-season, with little significant improvement in demand. Sustained price declines will exacerbate industry losses, potentially prompting some ethanolamine plants to shut down or reduce operating rates. This will curb the growth of the supply-demand gap, providing some support to prices once they reach low levels.September-November: Terminal industries will enter their traditional peak season, driving expected growth in demand. With limited supply growth during this period, the supply-demand gap will reverse to negative, and the industry will enter a phase of continuous destocking.December: Terminal industries will re-enter the traditional off-season, and declining demand will cause the supply-demand gap to turn positive and widen again.
Overall, ethanolamine prices are expected to perform relatively weakly in the first half of 2026, with the market navigating through oversupply and seasonal demand fluctuations before entering a more favorable destocking phase in the latter part of the year.
Key Takeaways for 2026
2026 will be a year of cautious optimism for China's ethanolamines industry, with supply and demand both set to grow moderately. While the oversupply trend will persist, the narrowing supply-demand gap and the anticipated destocking phase in the third quarter offer some positive signals. Industry participants should closely monitor key factors such as new capacity commissioning, plant maintenance schedules, and seasonal demand shifts in downstream sectors. For small-scale, high-cost plants, flexible operational strategies will remain critical to weathering market volatility, while integrated facilities are likely to maintain their competitive edge through stable operations and industrial chain synergies. As the industry continues to adjust and optimize, the focus on cost control and high-value-added applications may become increasingly important for long-term sustainability.
