Overview
Market fundamentals dominate as tensions in the Middle East ease.
Prior to the start of the US/Iran conflict market price action was dominated by plentiful supply in a market with lacklustre demand.
The impact of the conflict and in particular the closure of the Strait of Hormoz drove the buyers of standard polymers to secure inventory, and whilst demand appeared to exceed supply prices skyrocketed in April and May. For PE and PP June prices fell away quickly as the hostilities eased and market fundaments returned to their pre-conflict status, and for most players there is, apart from slightly higher crude oil prices, no reason why prices should not return to the levels seen in January and February of this year.
Whilst a few issues remain on some raw materials such as pigments and additives, performance polymers barely have had time to react before the situation in the Middle East eased and therefore pricing of engineering plastics has barely changed.
Demand over the months of July and August is typically low as many converters in Western Europe take seasonal holidays with converters in many countries enjoying factory shutdowns. Although demand will likely improve in September, the situation of bountiful supply is likely to remain throughout the remainder of 2026.
Monomer Price Movement
Feedstock
Price per Tonne
Change (contract)
C2 (Ethylene)
£1,247.84
-£172.71
C3 (Propylene)
£1,178.75
-£164.08
SM (Styrene Monomer)
£1,461.13
-£233.16
Benzene
£943.87
-£88.08
Butadiene
£980.13
-£172.71
Brent Crude (monthly average)
£477.07
-£94.67
Exchange Rates
€
1.16
$
1.33
€/$
1.16
Mike Boswell
Executive Chairman – Plastribution Group
Oil Prices
Exchange Rates
UK Economic Data
Topic
Item
Date
Change
Trend
GDP
Real GDP (Q on Q)
Q1 2026
£709,598
PMI
UK Manufacturing PMI
June
52.5
UK Output
Manufacturing Index
Q1 2026
100.4%
Sales
Retail Sales (Y on Y)
May 26
108.8%
Labour
Unemployment Rate
Feb 26 – Apr 26
4.9%
Prices
CPI (Y on Y)
May
2.8%
Prices
RPI (Y on Y)
May
3.1%
Interest Rates
Bank of England Base Rate
June
3.75%
Standard Polymers
July has seen further significant price reductions for both PE, PP as the market continues to find a new level following the volatile pricing of recent months. Monomers C2 and C3 dropped by €200 and €190 / MT respectively.
The July price drop depends on your starting point. We saw price erosion through the month of June with prices at the end of the month around £250 / MT lower than at the start. July pricing from the start of June is around £400 / MT lower for most grades of PE and PP when compared to the start of June.
At the time of writing, oil pricing was up as the ceasefire in the Middle East appeared to fail. However, the market is not reacting as it did before and there doesn’t appear to be any significant panic. Whilst a price rebound seems unlikely, it should put a brake on the price reductions as buyers return to the market and start securing safety stocks rather than a just in time approach.
Ian Chisnall
Product Manager – Polyolefins
Polyolefins Feedstocks
£/Metric Tonne by month
LDPE
Supply
Demand
LDPE has dropped further in July as demand remains muted. Margins for European producers are back in the red and this may curtail production to minimums. Some signs that we are hitting the bottom of pricing but that is heavily dependent on geopolitics.
LLDPE
Supply
Demand
LLDPE is down further in July as market is very well supplied with imports from USA and little appetite from buyers. Drops of £400 / MT from early June pricing are widely seen though the drop from the end of June is in the region of £100 / MT. With tensions in the Middle East rising again, we may see prices bottom out as uncertainty over availability returns.
HDPE
Supply
Demand
HDPE is down in July, prices are in the region of £300-400 / MT lower than at the start of June. Supply is plentiful and the only lever traders can pull to stimulate buying is lower pricing. As with all grades that see imports from the Middle East, the recent escalation may change attitudes but we’re unlikely to see a significant rebound though we should see prices stabilise.
PP
Supply
Demand
PP pricing is down in July with reductions in the region of £300-400 / MT from early June pricing reported. Some fluctuations depending on the quality and performance of the grade, some PPCP holding up better as European producers attempt to keep pricing in the black. We are more dependent on import from the Middle East for our PP compared to PE and a return to a blockade of the Strait of Hormuz may affect availability in the short to medium term.
PS
Supply
Demand
PS pricing has dropped by approx. £350 / MT as demand is poor and sellers look to stimulate demand with a decrease beyond the monomer settlement of -€270 / MT. Market may become more balanced if Middle East war escalates. Europe imports reasonable quantities of styrene monomer from the region.
Other Polyolefins
EVA pricing is down but not as much as other PE grades due to more balance in supply and demand and the higher cost of VAM. Reductions of around £200 / MT are reported. Speciality POP and POE grades have mostly moved down with monomer, but we are seeing corrections in pricing to try and stimulate demand.
Performance Polymers
It is still very much a mixed market with some renewed volatility due to increasing tensions between Iran and the US, but demand is subdued as the traditional summer holiday period gets underway. Prices appeared to have bottomed out in June and the market was showing signs of cost reductions, but this latest news and the increase in the oil price may change the situation yet again.
The Benzene contract price for July settled at €1,093/t, down by €102/t from June. Availability was improved as demand has fallen.
Pete Tillin
Product Manager – Performance Polymers
Performance Polymer Feedstocks
£/Metric Tonne by month
ABS
Supply
Demand
ABS prices have fallen back, mainly due to a reduction in composite costs. The styrene monomer contract price decreased by €270/t in July, ACN was down by €204/t, and butadiene down by €200/t. Supply has normalised, and many customers are now waiting to see what happens longer term, particularly as the Middle East situation seems far from over.
PA6
Supply
Demand
Prices are under downwards pressure, due to weak demand and higher levels of imports from outside the EU.
PA66
Supply
Demand
The market has stabilised, with spot prices lower, but more recently, there have been renewed calls for more increases. This might be unlikely though, due to lower demand during the summer period.
POM
Supply
Demand
As with many other performance polymers, demand is low and there are higher levels of imports arriving from the Far East, which has resulted in downward pressure on market prices.
PC
Supply
Demand
The recent cost reductions in composite costs such as Benzene have resulted in price reductions, but there is now some uncertainty as to what happens next.
PMMA
Supply
Demand
Demand is still falling and as cheaper material continues to arrive from the Far East, it is becoming more difficult for European producers to force through increases.
PBT
Supply
Demand
A mixed situation with calls for cost increases, but spot prices are lower. Demand is weak though, with sufficient supply, so any upward movement is unlikely.
Other Engineering Polymers
The situation for most other engineering materials is mixed, with market prices varying wildly and demand generally down.
Sustainable Polymers
Recycled Polyolefins have fallen in July as virgin prices dropped significantly and put pressure on suppliers. Demand remains muted and those that switched from virgin to recycled as virgin prices soared in March and April are returning to virgin.
Ian Chisnall
Product Manager – Sustainability
Recycled LDPE / LLDPE
Supply
Demand
Recycled LDPE / LLDPE has dropped triple digits as demand has slumped. Recyclers were optimistic as demand had a mini boom with the sudden virgin price increases of March and April, but this has been short lived. Whilst high quality grades continue to command a premium over virgin to meet the needs of packaging tax, low quality grades are under pressure again.
Recycled HDPE
Supply
Demand
Recycled HDPE is dropping as virgin prices have dropped and availability is no longer an issue. Natural grades are still in demand for consumer goods with Sustainability credentials but industrial grades for use in construction etc. are struggling to find buyers as demand is weak.
Recycled PP
Supply
Demand
Recycled PP is dropping triple digits. Natural pricing is relatively strong but industrial grades are readily available and demand is not great.
