What is driving the divergence between MTBE prices and producer profitability in China?

What is driving the divergence between MTBE prices and producer profitability in China?
MTBE sits in an awkward spot. Producers like Baofeng Energy reported MTBE revenue of 390 million yuan in the first three quarters of 2025 with prices down 19.75% year on year, part of a broad decline across six of seven major products. The cushion has been feedstock: gasification coal fell 19.02%, coking clean coal 31.82% and thermal coal 23.99%, creating a favorable scissors gap. But that relief is purely cyclical. With domestic polyethylene and polypropylene capacity still expanding 7-8% annually through 2027, product prices face continued pressure, and any coal price rebound would compress MTBE and olefin margins simultaneously.