A clear signal is emerging from Zhoushan, Zhejiang: the deep integration of a Chinese petrochemical giant and a multinational chemical leader will directly reshape the supply pattern of chemical fiber raw materials. On July 16, Rongsheng Petrochemical and Saudi Basic Industries Corporation (SABIC) signed a Project Development Agreement (PDA) to jointly advance the Jintang New Materials Project. SABIC plans an equity investment of 30% to 50% in the project company. This is not an ordinary capacity expansion; it redefines the pricing power and stability of the polyester supply chain.
Background
The Jintang New Materials Project is located in Zhoushan, Zhejiang, and represents Rongsheng Petrochemical's next major move after its Zhejiang Petrochemical integrated refining and chemical complex. Under the agreement, the two parties will evaluate SABIC's potential equity stake of 30% to 50% in Rongsheng New Materials (Zhoushan) Co., Ltd. This could make the project an international joint venture with Chinese majority control and deep foreign participation. The project's core goal is to enhance production capacity for advanced chemical materials, directly serving key downstream industries in China and Asia, with textile chemical fibers being one of the largest application areas.
From an industrial logic perspective, Rongsheng Petrochemical already operates a 40-million-ton-per-year integrated refining and chemical complex in Zhoushan, producing PX and ethylene glycol—direct upstream inputs for the polyester industry. If the Jintang project proceeds smoothly, it will further expand high-end chemical material capacity, potentially including new types of polyester and specialty fiber feedstocks. For the textile industry, this means not just an addition of capacity numbers, but also diversification of raw material sources and enhanced supply chain resilience.
Industry Impact
For the textile chemical fiber industry, this cooperation brings at least three significant impacts.
First, raw material cost volatility is likely to be suppressed. For a long time, prices of polyester raw materials like ethylene glycol and PTA have fluctuated sharply due to international oil prices and geopolitical factors. SABIC's involvement as a top global petrochemical player will bring more stable supply agreements and risk hedging capabilities. Rongsheng Petrochemical's general manager Xiang Jiongjiong emphasized in the announcement that the cooperation aims to 'inject important stability into the chemical industry.' This stability will directly translate into lower procurement costs for downstream textile companies.
Second, the localization of high-end differentiated fibers will accelerate. The Jintang project explicitly focuses on 'advanced chemical materials' and 'product portfolio upgrading.' This suggests the project may produce high-value-added polyester varieties such as cationic dyeable polyester, flame-retardant polyester, and bio-based polyester. Currently, China still relies on imports for some high-end chemical fiber raw materials. SABIC's technology infusion could fill this gap, enabling domestic fabric companies to obtain better raw material support when developing functional products.
Third, Zhoushan's status as a petrochemical and textile industry hub will be further solidified. The Zhoushan Green Petrochemical Base already has a complete chain from refining to polyester. The Jintang project will fill the high-end new materials segment. For textile clusters in the Yangtze River Delta—such as Shaoxing, Xiaoshan, and Shengze—this means shorter logistics distances and faster response times. Previously, these clusters sourced raw materials from Zhoushan by sea; after the Jintang project comes online, the proportion of local supply will increase significantly.
From a data perspective, China's polyester capacity in 2025 has exceeded 70 million tons per year, but the share of high-end differentiated products is less than 20%. If the Jintang project adds millions of tons of high-end capacity, it will directly change this ratio. SABIC CEO Dr. Faisal M. Alfaqeer stated that the cooperation aims to 'enhance the ability to serve global customers,' implying that the project's products will target not only the domestic market but also Southeast Asia, South Asia, and other regions where textile manufacturing is shifting.