Ethanol Production in China, January-June 2026
In the coal-to-ethanol segment, ethanol output increased during the first half of 2026. Bio-fermentation fuel ethanol production also rose, driven by the implementation of a new pricing mechanism from January, which boosted factory incentives for fuel production. From the latter part of the first quarter into the second quarter, changes in international relations led to higher downstream chemical exports and rising domestic prices. This increased factory production enthusiasm, and downstream demand supported normal ethanol plant operations, delaying scheduled maintenance in Northeast China. The continuous commissioning of coal-based ethanol capacity further exacerbated the supply-demand imbalance in the ethanol industry. There is virtually no possibility of expansion or new capacity additions for fermentation-based ethanol.
Production and Capacity Utilization Analysis
According to Chempricehub data, domestic ethanol production in China reached 5,393.6 thousand metric tons in the first half of 2026, a year-on-year increase of 7.00%. This growth was primarily driven by the rapid expansion of coal-to-ethanol (synthetic ethanol) capacity and the postponement of maintenance in Northeast China. Domestic capacity utilization fluctuated in the range of 53%–62% (excluding idle capacity).
Ethanol Production by Category, First Half of 2026 (Unit: thousand metric tons)
| Category | Half-Year Output | Share |
|---|---|---|
| Edible ethanol | 2,588.6 | 48% |
| Fuel ethanol | 1,655.5 | 31% |
| Coal-based ethanol | 1,149.5 | 21% |
| Total | 5,393.6 | 100% |
Source: Chempricehub
Chempricehub data show that by category, bio-fermentation ethanol remained the mainstream supply source in the first half of 2026, while the share of coal-based ethanol increased compared to the previous year.
Bio-Fermentation Ethanol Production by Feedstock, First Half of 2026 (Unit: thousand metric tons)
| Category | Half-Year Output | Share |
|---|---|---|
| Cassava-based ethanol | 422.9 | 10% |
| Corn-based ethanol | 3,752.3 | 88% |
| Molasses-based ethanol | 10 | 0% |
| Others | 58.9 | 1% |
| Total | 4,244.1 |
Source: Chempricehub
According to Chempricehub data analysis, the detailed breakdown of edible ethanol output in the first half of the year shows that cassava-based and corn-based ethanol remain dominant, together accounting for over 97%. Corn and cassava prices remained elevated in the first half of 2026, and ethanol producers in the major corn-producing regions of Heilongjiang and Jilin generally operated at a loss. The shift in fuel ethanol pricing models led to high production enthusiasm in the first quarter and early second quarter. The industry average capacity utilization rate for the first half of 2026 was 59.50%, and fuel ethanol margins remained acceptable, supporting production at some plants.
Chempricehub data indicate that domestic operating rates fluctuated in a range of 45%–62% during the first half of 2026. Maintenance in Northeast China was delayed, resulting in higher corn-based bio-fermentation ethanol output compared to the same period last year. New coal-based ethanol capacity came on stream, also boosting output. Overall operating rates edged slightly higher.
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