Europe’s PS Market Braces for Further Declines as Demand Remains Weak

European polystyrene (PS) prices continued to trend lower throughout June as weak demand and falling feedstock costs kept pressure on the market. Despite suppliers' efforts to stabilize prices earlier in the month, sluggish buying activity eventually forced larger discounts across the region.

Demand Remains the Key Concern

Processors largely continued purchasing only for immediate needs, while inventories remained comfortable following the strong buying activity seen during the March-April rally. Expectations of further price reductions also encouraged buyers to delay purchases, resulting in slow trading activity throughout June.

Even after multiple price cuts, demand showed little sign of improvement as downstream consumption remained weak.

Feedstock Decline Weighs on Market

The sharp fall in styrene costs has added further downward pressure on PS prices. European styrene values dropped significantly during June, returning to levels seen before the Middle East conflict and removing much of the geopolitical premium that had supported the market earlier this year.

Lower crude oil prices and softer benzene values have also reinforced the bearish sentiment across the styrenics chain.

Supply Remains Adequate

Supply conditions across Europe remained comfortable, with no major production disruptions reported. Material availability was sufficient to meet demand, while weak consumption prevented any concerns about shortages.

As a result, sellers faced increasing pressure to offer discounts in order to secure volumes.

July Outlook Stays Bearish

Market participants expect the downward trend to continue in July. The upcoming summer holiday season is likely to keep buying activity subdued, while lower styrene settlements could trigger another round of PS price reductions.

Although prices have already fallen sharply from recent highs, they still remain around 40% above pre-war levels, suggesting that further correction may be possible if demand remains weak.

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