Although the U.S. plastics industry has expanded rapidly over the past decade, new research by the Environmental Integrity Project and partners found that markets slowed down in 2025, with a wave of plant closures, construction delays, and production cutbacks across the plastic industry.
In general, over the last decade, the growth of the industry has been fueled by cheap natural gas and billions of dollars in government subsidies. A 2024 report by the Environmental Integrity Project (EIP) found that the production of ethylene – a primary building block of plastics – grew by 81 percent between 2015 and 2024.
But after years of rapid growth, markets are cooling. Analysts have pointed to overbuilding as a primary driver, with high interest rates and a manufacturing slowdown spurred in part by shifting U.S. trade policy injecting additional market uncertainty.
That uncertainty is starting to show, with several plastics plants shutting down or scaling back operations in 2025. To help track the buildout of the plastics industry, EIP and Material Research (MR3) have developed an inventory of production capacities for plastics plants across the U.S.
According to EIP's most recent update, 2025 saw a wave of setbacks for the industry. That includes the permanent closure of Westlake’s PVC plant in Aberdeen, Mississippi, as well as the company’s idling of several production units that support the production of PVC plastics in Lake Charles, Louisiana, because of “persistent, challenging market conditions.” Alpek also shut down its PET plastics facility in Fayetteville, North Carolina, as part of a “cost reduction” initiative.
Meanwhile, new projects and expansions are being delayed. Olin pushed major investment decisions into the next decade, citing weak global pricing and overcapacity. The news came after the company shut down several production units in Freeport, Texas. Challenging market conditions have also caused ExxonMobil to indefinitely pause the development of a massive new plastics plant in Point Comfort, Texas.
Despite the downturn, the Trump Administration’s war in Iran may prove profitable for some plastics companies. The U.S.-led conflict in the Middle East has driven resin prices to an all-time high, potentially presenting an opportunity for U.S. producers that rely on ethane (made from natural gas) rather than naphtha (made from oil) to manufacture plastics. High prices could eventually make new production more attractive, potentially reviving stalled projects or idled facilities.
According to the latest data from EIP and MR3, one new plastics plant is currently under construction in East Texas and eight new plants have been proposed, which together could increase ethylene capacity by over 10 million metric tons per year and plastic resin manufacturing capacity by 10.6 million metric tons per year. That’s in addition to the 18 existing facilities that have announced expansion projects.
Click here to learn more about the plastics industry in the U.S., including each plant’s production capacity, ownership information, and whether it has plans to expand.
