Recent Market Intelligence Report on Tetrachloroethylene

I. Price Trends
- Base Price: As of May 25, 2026, the Business Network’s benchmark price for tetrachloroethylene stood at RMB 4,055.56 per ton, representing a 1.39% increase from the beginning-of-month price of RMB 4,000.00 per ton, reflecting a mild upward fluctuation over the month.
- Regional Quotations:
- Shandong Province: Prices ranged between RMB 3,500–4,500 per ton, with significant variation attributable to brand, purity level, and packaging format. For example, LUXI Chemical’s 99.9% purity product was quoted at RMB 3,650 per ton, whereas Inner Mongolia Dakang’s 99.9% purity product commanded RMB 4,500 per ton.
- Other Regions: Jiangsu Province’s premium-grade product was quoted at RMB 4,200 per ton; Juhua Group (Zhejiang)’s 99.9% purity product was similarly priced at RMB 4,200 per ton.

II. Supply-Demand Dynamics
- Supply Side:
- Domestic production capacity is highly concentrated, with the top six producers (e.g., Juhua Technology, BinHua Holdings, LUXI Chemical) accounting for 61.45% of total capacity. China’s total annual capacity reached 511,000 tons in 2024, with an additional 64,000 tons/year under construction.
- Export volume surged significantly, reaching 47,000 tons cumulatively in 2025 — a 105.3% year-on-year increase — primarily destined for the UAE, Russia, and Turkey. However, export growth has not fully absorbed domestic production capacity.
- Demand Side:
- Primary application remains as a chemical raw material and intermediate in organic synthesis, accounting for approximately 75% of total consumption.
- Penetration in garment dry-cleaning has declined, falling to 61.4% in 2025; niche applications such as leather care and industrial cleaning have risen to 14.7%.
- Policy-driven substitution is accelerating: green alternatives — including hydrocarbon solvents and liquid carbon dioxide — collectively captured 28.3% market share.

III. Policy Impacts
- Export VAT Rebate Adjustment: Effective April 1, 2026, export VAT rebates were abolished for PVC powder, unplasticized PVC, and plasticized PVC — previously enjoying a 13% rebate rate. This policy aims to drive structural optimization and enhance industry competitiveness. In the short term, however, it raises export costs, prompting some enterprises to shift focus toward domestic sales and accelerating the exit of upstream producers lacking cost advantages.
- Environmental Regulations: The Ministry of Industry and Information Technology’s “Directory of Promoted Green Cleaning Equipment” offers subsidies of up to RMB 18,000 per unit for high-efficiency tetrachloroethylene distillation and regeneration equipment, boosting solvent recycling rates to 68.9%. Concurrently, the “Technical Guidelines for VOC Emission Control in Dry-Cleaning Using Chlorinated Volatile Organic Compounds” mandates full retrofitting by end-2025, requiring real-time solvent loss monitoring modules; installation coverage has reached 63.8%.

IV. Market Developments
- Corporate Strategies: Firms are focusing on the existing market by upgrading solvent recovery systems and developing high-end products to improve profitability. For instance, Shanghai Xinya Pharmaceutical established a medical-grade tetrachloroethylene purification line (purity ≥99.995%), generating RMB 137 million in revenue in 2025; Jiangsu Flying Chemical’s closed-loop recovery system achieves ≥92.3% recovery efficiency, serving 142 chain dry-cleaning centers.
- Industry Consolidation: Exit of small- and medium-scale capacities is accelerating; leading enterprises are consolidating market share via M&A and overseas expansion (e.g., into Southeast Asia).

Analysis & Assessment

I. Drivers of Price Volatility
- Supply-Demand Dynamics: Export growth has failed to fully absorb domestic capacity, while demand erosion in dry-cleaning exerts short-term downward pressure on prices. Nevertheless, rising demand for high-purity grades (e.g., medical- and electronic-grade) and integrated solvent recovery services provides partial price support.
- Policy Impact: The VAT rebate adjustment increases export costs and temporarily weakens export competitiveness; yet long-term structural optimization and enhanced industry competitiveness are expected. Environmental policies promote higher recycling rates, reducing reliance on virgin feedstock and thereby contributing to price stability.

II. Market Trends
- Short Term: Prices may remain weak but with limited downside, supported by export orders and environmental subsidy programs.
- Long Term: With ongoing environmental substitution in dry-cleaning and evolving consumer preferences, demand for tetrachloroethylene in dry-cleaning will continue declining. Meanwhile, demand in chemical synthesis and intermediates remains stable, and high-end product demand is growing — resulting in structural market divergence.

Forecast

I. Price Outlook
- Short Term: Tetrachloroethylene prices are likely to maintain mild fluctuations, with limited upside potential; the expected trading range is RMB 3,800–4,500 per ton.
- Long Term: As supply-demand equilibrium improves and high-end demand expands, prices may gradually stabilize and recover — though the pace and magnitude depend on industry consolidation progress and enforcement rigor of environmental policies.

II. Market Trend Outlook
- Demand Structure: Dry-cleaning demand will persistently decline; demand in chemical raw materials and intermediates will remain stable; high-end product demand will grow steadily.
- Industry Consolidation: Accelerated exit of small- and medium-scale producers will continue; leading enterprises will strengthen market positions through mergers, acquisitions, and overseas expansion — further increasing industry concentration.
- Green Substitution: Hydrocarbon solvents and liquid CO? — among other eco-friendly alternatives — are rapidly penetrating mid-to-low-end markets, catalyzing the sector’s green transformation.