• A new world-scale MDI production facility to be built at the Shanghai Integrated Site, targeted for commissioning around 2030
• Building on existing partnerships with TA'ZIZ and Fertiglobe, Covestro launches a feasibility study for an additional world-scale MDI plant in the UAE
• Both MDI production facilities are designed to achieve net-zero operational greenhouse gas emissions
• Committed to securing reliable long-term supply for customers amid sustained global MDI market growth
• The projects receive backing from strategic partner XRG

Covestro today unveiled a strategic investment plan for MDI, aimed at consolidating its global market leadership and further strengthening long-term supply security for customers worldwide. The plan covers the development of a new 660,000-tonne-per-annum MDI production unit at Covestro’s Shanghai Integrated Site, scheduled to start operation around 2030. Concurrently, Covestro is conducting a feasibility study for a plant of identical capacity in the United Arab Emirates. Both initiatives underscore Covestro’s strategic ambition to deepen its presence in the global MDI market and drive long-term growth. Supported by XRG, the projects fully leverage the strengths of Covestro’s global chemical platform, including integrated value chain construction and enhanced cross-regional supply chain resilience.

Catering to Rising Global MDI Market Demand

“This investment plan underscores our steadfast commitment to customers and our resolve to sustain long-term growth in the MDI market,” said Dr. Markus Steilemann, CEO of Covestro. “Market demand remains robust and expanding, while customers’ requirements for supply reliability continue to rise. Through these planned investments, we will further scale up our capacity to serve customers and fully capitalize on our technological and operational strengths. XRG’s long-term commitment lays a solid foundation for project delivery, enabling us to maximize integrated value chain advantages, boost supply security, and sustain competitiveness on the global stage.”

MDI (methylene diphenyl diisocyanate) is a core raw material for rigid polyurethane foam. Global MDI demand is projected to grow steadily over the long run, driven by multiple application sectors: energy-saving insulation solutions for the construction industry, energy efficiency improvements and sustainable retrofits for food cold chains in the home appliance sector, as well as sports and lifestyle applications. Growth is particularly pronounced across Asia and the Middle East. Meanwhile, demand growth is expected to outpace capacity expansion, making large-scale, dependable supply capacity more critical than ever. As one of the world’s leading MDI manufacturers, Covestro operates production sites across Europe, Asia and North America.

China: Steady Expansion Backed by Outstanding Operational Expertise

Covestro intends to expand its Shanghai Integrated Site with a new MDI production facility. Beyond the core MDI unit, the investment covers upstream manufacturing plants and supporting infrastructure, forming an integrated production layout via on-site manufacturing of key intermediates. The facility will deploy Covestro’s proprietary MDI AdiP technology to drastically cut energy consumption, with a design target of net-zero greenhouse gas emissions for Scope 1 and Scope 2 operations.

“Our Shanghai Integrated Site boasts a proven track record of operational reliability and complex project delivery,” stated Dr. Thorsten Dreier, Chief Technology Officer of Covestro. “The new MDI unit will not only lift overall production efficiency but also advance our ambitious climate neutrality target for operations. This target is made achievable by our proprietary AdiP technology, which has completed full-scale industrial validation in Germany.”

UAE: Exploring Synergies Within a Strategic Industrial Ecosystem

The feasibility study for a potential new MDI production complex in the UAE builds on previously announced partnerships with TA'ZIZ and Fertiglobe to assess synergies within the emerging industrial ecosystem of Al Ruwais Industrial City. Such large-scale global facilities will complement Covestro’s “local-for-local” manufacturing strategy and further reinforce supply security for customers across all regions worldwide.

The assessment will focus heavily on access to renewable energy, alongside the advantages of TA'ZIZ Chemical Park’s integrated industrial platform, including reliable local supply of key feedstocks such as chlorine and ammonia. Should the investment receive final approval, the project will draw on learnings from the Shanghai site development.

XRG Delivers Strategic Insights for Covestro’s Future Growth

Both projects reflect Covestro’s prudent, disciplined approach to capturing long-term growth opportunities in the global MDI market while focusing on sustainable value creation. As a strategic investor in Covestro, XRG brings a long-term investment mindset and global platform perspective to support the company’s next phase of expansion.

“Our capacity expansion in China and the feasibility study for the UAE demonstrate our proactive efforts to seize opportunities, strengthen supply chain resilience, sharpen competitiveness, and deliver consistent long-term support to our customers,” Dr. Steilemann added.