European PS and ABS Prices Slide as Weak Demand Offsets August Gains

European PS and ABS markets lost ground in September after their short-lived, cost-driven recovery in August. The €140/ton fall in the styrene contract, together with subdued demand, prompted most suppliers to reduce offers significantly. The size of the cuts differed according to previous price levels and how much margin each producer was trying to retain.

Although some buyers returned after the summer break to rebuild depleted inventories, the improvement in purchasing activity was inconsistent and not strong enough to support the broader market. Meanwhile, rising crude oil, spot styrene and benzene prices have strengthened the cost outlook for October, potentially limiting the duration of the current downward trend.

PS Market Tracks the Styrene Decline

PS producers generally lowered September offers by €100–150/ton. Many sellers passed through the entire €140/ton reduction in styrene, as weak demand made it difficult to defend margins. Some suppliers opted for smaller decreases, while deeper reductions were reported where earlier price levels remained relatively high.

Initial offers received by buyers were mostly €100–140/ton below August levels. Some buyers moved quickly to secure material because of increased consumption or limited stocks, while others remained on the sidelines, arguing that prices were still too high to justify significant inventory building.

ABS Prices Fall Despite Butadiene Support

ABS prices also declined during September, although the €50/ton increase in the butadiene contract provided some offset to the weaker styrene cost base. Most market participants reported reductions of approximately €60–100/ton, with some suppliers limiting their cuts to protect already compressed margins.

More aggressive reductions appeared in selected cases, particularly from producers looking to bring their offers in line with prevailing market levels or generate additional sales while carrying high stocks. Competitive imports, especially from China, continued to add pressure to European ABS prices.

Selective Restocking Fails to Signal Demand Recovery

Market inquiries increased for some suppliers compared with the summer period as buyers with low inventories returned after the September price reductions. Converters with immediate requirements also purchased their regular volumes.

However, the increase in inquiries has not developed into a sustained demand recovery. Some suppliers reported stronger buying interest during the previous week, followed by a slowdown. Many converters continue to adopt a cautious approach because of uncertain end-product demand and concerns over the coming months.

Overall supply remains comfortable. A few participants pointed to potential delivery delays from a regional producer during September, encouraging certain buyers to secure material earlier, but these issues have not resulted in broader supply tightness.

Producers Likely to Resist Deeper September Cuts

PS transactions during the remainder of September are expected to remain broadly aligned with the €140/ton styrene decline. Producers that initially offered smaller reductions could face pressure for further adjustments if order intake remains weak, although limited margins should restrict the scope for additional concessions beyond the cost-related decrease.

In ABS, reductions are expected to remain largely within the €80–100/ton range. Suppliers that have already reflected the full cost impact are likely to resist further discounts, while producers that started with smaller reductions could face pressure to lower offers if demand does not improve.

Upstream Cost Surge May Change October Direction

The upstream cost environment has strengthened considerably since the September contracts were settled. Brent crude has moved above $107/bbl, while spot styrene reached approximately $1,600/ton FOB NWE, its highest level since mid-May. Spot benzene has also climbed by around $175/ton over the past two weeks, reaching approximately $1,230/ton CIF NWE.

If these higher costs persist, they could prevent another significant decline in October and encourage producers to target rollovers or fresh increases. At the very least, the stronger upstream market is expected to make sellers more resistant to further price concessions.

However, persistently weak demand could prevent producers from fully passing higher costs on to buyers. Any potential price recovery in October would therefore likely be driven primarily by rising costs rather than stronger consumption.

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