Introduction: China maintained high toluene export volumes from 2021 to 2026. This trend served both the objective of generating foreign exchange revenue and as an effective measure to alleviate domestic oversupply. During this period, China’s toluene exports surged from 97,000 tonnes to 1.69 million tonnes, representing a compound annual growth rate (CAGR) of 77.2%.
From January to September 2026, China exported 1.35 million tonnes of toluene. The top five trading partners were Singapore, South Korea, India, Malaysia, and the Netherlands, which collectively accounted for 88% of total export volume.
In 2026, South Korea became the largest destination for Chinese toluene exports, with resources primarily flowing into the local disproportionation industry. This shift was driven largely by the opening of arbitrage windows between Asia and the United States from April to July. As the U.S. entered its peak gasoline demand season, supply tightness for high-octane blending components pushed toluene prices to elevated levels. Consequently, large volumes of Asian toluene, predominantly sourced via South Korea, were exported to the U.S. market. South Korea thus absorbed the majority of China’s incremental toluene exports. Notably, direct exports of toluene from China to the U.S. also reached 30,000 tonnes during the year.
Singapore ranked second among export destinations. Toluene exported from China to Singapore is primarily used in gasoline blending. This demand is underpinned by geopolitical conflicts in the Middle East, which have led to widespread reductions in operating rates at Asian refineries. The resulting tightening of refined product supply has significantly increased the demand for toluene as a blending component. As a result, Singapore has established stable consumption patterns for Chinese toluene specifically for blending purposes.
From 2021 to September 2026, China’s toluene exports were concentrated almost entirely within general trade, with only one instance recorded under processing with supplied materials.
In 2026, toluene exports via general trade totaled 1.35 million tonnes, accounting for 100% of the total export volume. Throughout the period from 2021 to September 2026, only one shipment utilized the processing-with-supplied-materials model; all other exports were conducted through general trade. The dominance of general trade is attributed to the prevalence of unilateral export activities by enterprises holding import and export rights in China. Compared to other trade modes, general trade offers lower costs and higher efficiency, thereby securing its leading position.
On a global scale, markets such as South Korea, India, Southeast Asia, and the United States remain dependent on toluene imports. As China continues to release new production capacity, shifts in the domestic supply-demand balance will increasingly influence global resource flows. Since capacity expansion remains concentrated in China, it is projected that China’s toluene export volume will continue to grow in 2027.
Regarding export destinations, the primary flow of Chinese toluene in 2027 is expected to remain focused on Asia. Singapore is likely to retain its position as the largest export destination, driven mainly by demand for gasoline blending. South Korea and European regions follow as key markets. Currently, exports to South Korea have achieved normalized operations, supported by the continued execution of annual long-term contracts, which helps stabilize export volumes. Building on the geopolitical disruptions of 2026 and the gradual recovery of South Korea–U.S. arbitrage flows, it is anticipated that increased South Korea–U.S. arbitrage activity in 2027 will further boost China’s exports to South Korea.
Other parts of Southeast Asia also face supply gaps, suggesting that China’s toluene exports to India and other Southeast Asian nations will rise in 2027. As a major emerging market globally, India offers substantial potential for solvent product demand. Combined with China’s geographic and logistical advantages, along with improving bilateral trade relations, these factors may jointly drive an increase in exports to India. Similarly, countries like Vietnam and Indonesia benefit from significant proximity advantages relative to China, and exports to these regions are also expected to grow.
In terms of trade modes, general trade is projected to remain the predominant method. Amid ongoing capacity expansion in China and a market characterized by oversupply, exporting has become an inevitable choice for more enterprises. Given that general trade is more economical and convenient than alternative methods, its dominant status is expected to persist through 2027.
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