Prices mostly stable amid weak year-end demand / Industry enters 2026 with ample supply and low expectations / Cautious start to the year with little hope for early recovery

PE: For the most part, converters found it easy to resist producers’ attempts to push through price increases. Negotiations often resulted in price stability, reflecting the rollover in the ethylene contract price as well as the lack of orders. Import volumes continue to prevent the market from rebalancing, despite ongoing cutbacks at European plants. As is typical at year-end, many converters shut down their production lines after mid-month and began with maintenance work and stock-taking. In quite a few cases, parts of the workforce were sent on Christmas leave early. The question on everyone’s mind is: how are things going to go in 2026? While the large packaging segment continues to provide a fairly stable supply of orders, nearly all converters prefer to purchase the material they need at the very last minute and at the lowest possible prices. This is intended to give them an edge over domestic competitors and to at least partially keep pace with low-priced Asian imports. However, the prospects of achieving this are poor. A recovery in demand in the first half of the year is not expected. Prices are therefore likely to depend primarily on how effectively producers maintain control over supply.

PP: Some players will probably be pleased about the conclusion of 2025. At least at the negotiating tables every effort was made to quickly finalise the monthly discussions for December. The contracts often followed the lead of the precursor, propylene, and kept prices at the previous month’s level. Those who still bought material usually did so in order to achieve certain quantities for their annual bonus – and only in return for further price concessions. As is usual at the end of the year, producers and processors were keen to reduce their inventory levels in order to bolster their balance sheets. The market for homopolymer grades was clearly oversupplied. The oversupply of copolymer grades and compounds was not quite as noticeable. The outlook for 2026 is still bleak in many places. Only optimists expect an improvement in the near future. However, the fact that the propylene contract for January fell by EUR 30/t is likely to result in further price adjustments, albeit not to the full extent of the monomer reduction. As a result, the mood is likely to improve slightly, at least among processors.

PVC: The development in PVC prices largely followed feedstock ethylene. As a result, the monthly PVC contract was fixed at a rollover. There was little else to negotiate for December, and attention quickly shifted to the annual contract discussions for 2026. Supply was more than sufficient, with demand running at a very low level as the year drew to a close. The year-end period was nevertheless marked by an unpleasant surprise – the announcement of the insolvency of Vynova Wilhelmshaven. This development inevitably forced a number of converters to reorient themselves once again during the course of their annual negotiations. It also dampened the mood among those who had already concluded agreements with alternative suppliers. The insolvency once again underscores the current precarious state of the European PVC industry. Against this backdrop, producers are likely to attempt to avoid passing on the EUR 25/t reduction in ethylene prices in January, particularly as the new starting prices for 2026 already represent a downward adjustment.

Styrenics: In December 2025, the eight-month downward trend in styrenics prices came to an end. After the styrene reference increased for the first time in a long while in the year-end month (up EUR 21/t), prices for polystyrene and EPS also trended up slightly. ABS prices only managed a (in some cases strong) rollover, as the decline in the cost of butadiene (down EUR 40/t) outweighed the ACN cost increase (up EUR 20/t). All in all, demand for styrenics remained weak in December. Although orders for polystyrene were not quite as bad as expected, demand for ABS and EPS still had plenty of room for improvement. The sluggish economy was compounded by the low number of production days, as many companies took extended factory holidays. In addition, many processors were reluctant to build up stocks for balance-sheet reasons. In January, prices for polystyrene and EPS are likely to edge up again, following another modest increase in the styrene contract price (again up EUR 21/t). ABS, however, is likely to see another rollover, as declines in butadiene (down EUR 20/t) and ACN (down EUR 36/t) offset the upward trend of styrene. In view of the ample supply situation, slight reductions cannot be ruled out, either. Meanwhile, there are several aspects that should support styrenics prices as the year progresses. For polystyrene, this includes the consolidation of production capacity. While imports are continuing to rise, the closure of two production facilities in France and Germany should nevertheless reduce the existing oversupply. EPS, meanwhile, could benefit from growing signs that the long dry spell in residential construction is coming to an end. However, it will probably be some time before the rising number of building permits is reflected in demand for EPS. That leaves ABS: European suppliers are likely to benefit from the fact that the European Commission is considering setting the final anti-dumping tariffs on materials from South Korea at a higher level than the provisional punitive tariffs currently in place. A decision on this is expected in February.

PET: As expected, little happened on the European PET market in December 2025. Demand continued to be weak, with business running at a correspondingly sluggish pace. Everyone has long since turned their attention to the new year. All in all, the situation led to cautious rollovers in an overwhelming majority of cases. No one is expecting a significant upturn at the start of the year. The prevailing attitude is one of wait and see. In the interests of security of supply, large-scale consumers report that they are considering providing selective support for European production on strategic grounds. The economic situation is thus increasingly being factored into the calculations of the companies operating here – a highly interesting and presumably unavoidable development. Overall, only slight changes are set to come about in January.

More information on PIE Polymer Price services ...