Covestro Expands MDI Capacity with Plants in China and UAE

Strategic MDI Investments Covestro Pushes Ahead with MDI expansion in Shanghai and examines UAE site

2026-07-03 Source: Covestro 2 min Reading Time

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Demand for MDI is growing worldwide, particularly in Asia and the Middle East. Covestro aims to respond with a new large-scale plant in Shanghai and is also examining a further world-scale project in the United Arab Emirates.

Aerial view of the Covestro Integrated Site Shanghai(Source: Covestro) — Aerial view of the Covestro Integrated Site Shanghai
(Source: Covestro)

The plastics producer Covestro has announced a strategic investment programme for MDI. The programme includes preparations for the construction of a new MDI production plant with an annual capacity of 660 kilotonnes at the integrated site in Shanghai, China. Commissioning is scheduled for the end of this decade. In addition, the company is examining the construction of a further plant of a similar scale in the United Arab Emirates as part of a feasibility study. Both projects reflect Covestro’s long-term growth ambitions in the global MDI market.

Covestro expects global demand for MDI, or methylene diphenyl diisocyanate, to continue growing in the coming years. Key growth drivers include energy-efficient construction and renovation, modern household appliances, and numerous applications in the leisure and consumer goods sectors. The markets in Asia and the Middle East are developing particularly dynamically. The group is one of the world’s leading producers of MDI and has a global production network in Europe, Asia and North America.

Capacity Expansion in China

The company plans to expand its integrated site in Shanghai, China, with a new MDI production plant. In addition to MDI production itself, the project also includes additional plants and infrastructure for key precursors, thereby expanding integrated value creation at the site. Covestro’s proprietary Adip technology will be used, which is intended to significantly reduce the energy requirements of production. According to Covestro, the new plant is designed to be operated with an operationally climate-neutral greenhouse gas balance for Scope 1 and 2 emissions.

Feasibility Study in the UAE

As part of a feasibility study, Covestro is also examining the construction of a new MDI plant in the United Arab Emirates. The study builds on the previously announced partnership with Ta’ziz and Fertiglobe and will examine synergies within the emerging industrial cluster in Al Ruwais Industrial City. A globally oriented plant of this scale would have the potential to complement Covestro’s local production approach and increase supply security for customers in all regions.

The study is expected to take into account access to renewable energy sources as well as the integrated industrial platform of the Ta’ziz chemicals site, including reliable local supplies of key raw materials such as chlorine and ammonia. A potential investment would build on the project concept from China.

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