Tianfeng Securities: The chemical industry has entered the historical bottom zone, with the supply side increasing its weight in industry supply and demand adjustments.

Tianfeng Securities research report states that the chemical industry’s new capacity has entered the release phase, and a supply and demand reversal is expected by 2026.
The chemical industry has already entered a historical bottom zone, with increased emphasis on the supply side during industry supply and demand adjustments.
In the short term, “counter-involution” promotes price recovery and profit restoration by controlling startup methods to adjust supply and demand balance, while in the medium to long term, attention is focused on the pace of shutting down inefficient capacity to promote technological upgrades, eliminate homogeneous competition, increase R&D investment, and shift toward high value-added products; policy arrangements can accelerate the industry cycle recovery.
Supply and demand reversal: the policy and capital expenditure inflection point has already appeared in 2025; the proposal of “counter-involution” provides expectations for subsequent industry profit improvement and a move toward healthier long-term development.