Polymer prices - Unusually weak demand in April
Due to weak demand, price reductions occurred in early March, which more or less followed the contractual monomer price changes. The combination of the fall in polymer prices and volatile feed-stock prices over the past week has added to the uncertainty, to which most converters and their customers have reacted with a wait-and-see approach. The PVC market is also characterized by anticipation, despite the fact that 4 European plants have also shut down. The combined effect of the above factors was that polymer producers' expectations of strong demand in the first two weeks of April and weak demand in the second half of April did not materialise.
Not only were plastics converters' willingness to buy low, but so were their customers'. However, this was not only the case last week, but also in the first quarter of 2025. There are no signs of demand recovery yet, most plastics converters expect that perhaps the period between early May and mid-June will bring an improvement in demand. In the meantime, they wait, not expecting supply problems or shortages.
A small recovery is possible in May, but no fundamental change in demand is expected. However, this demand shortage is different from previous ones, we can safely say that there is a recession. Contrary to earlier expectations, no recovery is expected in the second half of 2025. The solution is likely to be a forced reduction in supply, consolidation, both in plastics conversion and in polymer production. It is not yet known how much capacity reduction is necessary, however, if we look at the example of the PVC market, the size of the problem is clearly visible. Due to low capacity utilisation and deteriorating profitability, more than 20% of operating PVC capacity in Europe (excluding Russia) has been shut down. Nevertheless, there is no shortage, all major grades are available for the time being. Further shutdowns are also expected if prices fall further. Yet the PVC market is protected by anti-dumping duties. The situation is similar for other polymers; in 2025, the decision to permanently shut down several Western European polymer plants will likely be made.
Consolidation in plastics conversion will also be characterized by a kind of evolution. Those converters who are able to meet the documentation requirements imposed by the EU will remain competitive. These are typically larger companies for now.
For now, plastics converters are looking ahead to May. However, with 3 weeks to go, the current uncertain market conditions with significant feedstock price volatility make it impossible to make any serious forecasts. Thus, converters have no choice but to try to avoid the two biggest mistakes: over- and under-stocking of feedstock.
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Vacula s.r.o. - supplier of POM Materials for Technical Applications from KPAC
23.4.2025 Vacula s.r.o. specializes in the supply of high-quality POM (polyacetal) materials for technical and industrial applications. We are an official partner of KPAC (Korea Polyacetal Co., Ltd.), one of the leading global manufacturers of polyacetal...
