China's petrochemical producers have idled capacity to a three-year seasonal low as rising feedstock costs and weak export demand squeeze margins. Hengli Petrochemical Co., one of the largest purified terephthalic acid makers, has taken units offline for maintenance, Bloomberg Terminal data shows. The shutdowns have removed about 20% of national capacity.

Operating rates have plunged to just 68%, according to local industrial news outlet Welink. The cutbacks affect plants supplying textile and plastics factories, signaling broader manufacturing stress. This marks a sharp reversal from earlier expansion plans as producers grapple with deteriorating profitability.

The capacity reductions reflect mounting pressure on China's industrial sector from both input costs and sluggish global demand. With major producers scaling back operations, the petrochemical industry faces a challenging period ahead as it navigates the dual headwinds of expensive raw materials and soft international markets.