TAIPEI (Taiwan News) — Taiwan’s major chemical fiber companies have reduced production in response to severe oversupply and price competition driven by Chinese capacity expansion, CNA reported.
Lealea Group suspended part of production at its Changhua plant in October, including a 60% reduction in polyester chip output, while PET chips for bottles were completely stopped. The company said China’s large-scale production, coupled with declining domestic demand for polyester products, has led to market oversupply.
Lealea President Chen Han-ching (陳漢卿) said the company will offer voluntary retirement programs and cut about 30 jobs following the partial shutdown to lower operating costs. He noted the vacated space may be leased for AI data center operations.
Li Peng Enterprise, a subsidiary of Lealea Group, reduced its nylon chip production capacity by nearly 57% in December. Despite an annual capacity of about 405,900 tonnes, orders have declined since 2022, falling to 100,700 tonnes in 2024.
China Petrochemical Development, a subsidiary of Core Pacific Group, halted production of caprolactam — the raw material for textiles, automotive parts, and packaging — at its Miaoli plant in November. The move reduced the company’s annual capacity for the material to 200,000 tonnes.
China Petrochemical said that it will continue its energy transition efforts and develop specialty chemicals. The company is also exploring manufacturing chemicals for electronic applications and leasing part of the idle space to other businesses.
Zig Sheng Industrial Chair Su Pat-huang (蘇百煌) highlighted the scale of China’s expansion of chemical fiber capacity. He noted the country’s annual polyester and nylon chip capacity has reached 100 million tonnes, making it difficult for Taiwan to compete.
In response, Zig Sheng has significantly reduced its nylon chip capacity and shifted focus to polyamide 66, a nylon material with better durability and thickness. The company’s processed yarn made from the material has secured orders and is forecast to account for 20% of its processed yarn sales this year.
