Europe’s ABS Correction Deepens as Further July Price Falls Expected

Europe’s ABS market remained under pressure in June as producers were forced to abandon initial rollover efforts amid weakening demand and deteriorating market fundamentals. Transaction prices moved lower throughout the month, with discounts of up to €200/ton widely reported, while some market participants indicated even larger reductions in the distribution segment.

Demand conditions stayed sluggish across the region, as many converters continued to rely on inventories accumulated during the March-April buying cycle. Weak order intake from key downstream sectors and expectations of additional price declines encouraged buyers to restrict purchases to immediate requirements, resulting in limited trading activity.

Adding further pressure, competitive import offers from Asia, particularly China, continued to target the European market. Some imported ABS injection and extrusion grades were offered below €2000/ton DDP, increasing competition for regional suppliers. Local ABS injection grades in Italy were reported around €2100-2200/ton FD as sellers sought to secure business in a slow market.

Feedstock developments also reinforced the bearish outlook. The July butadiene contract settled €200/ton lower, while styrene prices fell sharply during June, raising expectations of a substantial decline in the July styrene settlement. Lower raw material costs have further weakened support for ABS pricing.

Market participants expect another round of significant ABS price reductions in July as weak demand, comfortable inventories, lower feedstock costs, and aggressive Asian competition continue to weigh on the market. The seasonal slowdown, coupled with planned summer maintenance shutdowns and holiday closures across Europe, is also expected to reduce buying activity further in the coming weeks.

Although ABS prices have already corrected from their recent highs, they remain well above levels seen before the Middle East conflict earlier this year, indicating that a portion of the previous price surge has yet to be fully unwound.

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