Polymer prices - clear expectations of a price decline in July

26.6.2026

The past week was marked by a lack of demand and plummeting prices. Polymer manufacturers have exerted strong supply pressure on the market. On the one hand, they are trying to realize the positive margins that still exist in the value chain.

On the other hand, they are striving to meet their half-year sales targets, and listed companies—due to their half-year reports—are trying to minimize their polymer inventory levels. The significant price cuts in June—amounting to several hundred euros for certain polymer grades—triggered a major selling panic among converters as well; they are trying to get rid of their products made from expensive polymers before their customers also begin demanding that the polymer price reduction be reflected in the prices of finished goods.
However, converters are trying to reduce not only their finished product inventories but also their polymer inventories; they are essentially not buying anything, preferring to wait and see, in the hope of further price declines in July. Converters now view high inventory costs as a greater threat than potential supply problems.
Due to the improving global economic climate and falling oil prices, polymer manufacturers also expect prices to decline. BRENT is approaching the price level seen in early March; prices have been below 80 USD per barrel over the past week. Naphtha also fell below 700 USD per metric ton. A significant drop in olefin monomer prices is expected. If we look only at the olefin monomer prices from the previous month, the change is actually in the triple digits. However, amid the excitement of the past few months, we didn't even notice that changes in monomer prices did not follow changes in feedstock prices. From early April to early June, the price of naphtha fell by 25.7%, while the price of ethylene rose by 3.1% and the price of propylene rose by 6.1%. If we look at the figures based on early January 2026, the picture isn't quite as alarming: the price of naphtha rose by 50.3%, the price of ethylene by 52.3%, and the price of propylene by 63.7%. In summary, this means that the profitability of monomer production has increased over the past six months, and that there is room for a significant contract price decline—exceeding 100 euros—in July, particularly for propylene monomer.
It is not only due to panic, but also to the profits still present in the polymer value chain, that European polyolefin producers have begun to significantly reduce prices over the past three weeks, seeking to realize those profits while they still can. Some polymer manufacturers sold larger volumes outside their main markets in an effort to stem the decline in prices. This is how underpriced polyethylene produced in Southwest Europe appears in Central Europe, and how Central European polyethylene and polypropylene appear in Turkey, causing unexpected price drops here. Due to the steep decline in polymer prices—which is set to continue in the coming week—the positive (NAPHTHA – polyolefin) integrated margin will disappear by July, along with the supply pressure. It's not just polymer manufacturers who are clearing out their inventories; traders and plastics converters are doing so as well. Due to the sharp drop in prices, the volume of imports from the Far East—which have long lead times—is also declining. Many traders are willing to sell the shipments currently arriving—even at a small loss—in order to avoid larger losses later on. Fewer shipments are currently being sent from the Far East. As a result, supply pressure will be lower in July and August, and the rate of price decline will also be lower.
Market participants are divided in their views on changes in polymer prices; some expect prices to stabilize due to tightening supply and low inventory levels, and even anticipate a slight price increase as early as this summer as the fall season approaches. According to other opinions, just as was the case last year, there will be no real fall demand this year either, so the only change will be in the pace of the price decline.

Author: myCEPPI