Asian flows return as Europe’s PP rally hits 4-year highs, demand falters

In Europe, the PP market has extended its sharp rally into mid-April, with prices surging to 4-year highs after cumulative gains of around 100-115% since late February. While persistent supply disruptions and record-high feedstock costs continued to support sellers, the latest price spike has started to reshape trade flows, drawing renewed interest from Asian suppliers.

Asian suppliers re-target Europe amid widening arbitrage

As European PP prices climbed to 4-year highs, the arbitrage window reopened, prompting Asian sellers to redirect volumes to the region after weeks of limited activity.



Market participants reported a fresh wave of more competitive import offers this week, particularly for forward shipments.

A converter in Italy secured South Korean PPBC inj. at €1700/ton CIF, 60 days, for June-September delivery on a fixed-price basis, as he does not expect European prices to fall below this level in the coming months. A different buyer reported closing deals for South Korean material with delivery in August at €1570/ton for PPH, €1680/ton for PPBC and at €1800/ton for PPRC, all on CIF basis. A trader also reported South Korean PPBC and PPRC offers respectively at €1720/ton and €1820/ton CIF, with shipment in late May.

Vietnamese PPH offered a rather competitive edge at €1570/ton CIF, with shipment in April.

Similarly, Chinese PPBC inj. was heard at around €1600/ton DDP for August delivery, pointing to a gradual return of Asian cargoes.

Traders noted that producers in Europe are holding inflated price ideas, while those who secured material at lower levels earlier are now more flexible in negotiations to capture margins and meet buyer interest. Still, not all buyers are willing to commit to imports, as long lead times and the uncertain market outlook continue to curb appetite.

Sellers achieve massive gains, but demand starts to falter

April deals across Europe were largely concluded with steep increases of around €450–500/ton, in line with or exceeding the propylene contract settlement. Players also reported cumulative hikes of up to €1150/ton compared to late February levels.

Despite these gains, demand has started to show clearer signs of fatigue. Many sellers observed a slowdown in buying activity, as converters increasingly resist elevated prices.

Several buyers reported limiting purchases to 50% or less of their usual volumes, while others opted to skip buying altogether and run down existing stocks. Order cancellations were also reported, particularly from buyers facing weak end-product demand.

A distributor noted a “strong halt” in demand in recent days, adding that current levels are becoming unsustainable for the entire value chain. Likewise, a seller said that while some buyers are still forced to purchase, many others are stepping back, leading to reduced activity compared to March.

Converters continue to struggle to pass on higher costs, particularly in sectors such as packaging. Some players reported only partial and gradual price increases to their customers, while others warned that persistently high PP prices could eventually force certain downstream sectors to curb production.

Record-high C3 continues to underpin the market

Upstream dynamics remain a key pillar of support. Spot propylene prices have surged to fresh all-time highs, hovering around €1950/ton FD NWE at the time of writing.

This unprecedented level follows weeks of sharp increases driven by tight supply and ongoing production disruptions across the region. The strength in feedstock costs has enabled producers to justify April hikes and is expected to keep pressure on PP prices moving forward.

May outlook under discussion

Expectations for May have started to take shape, with most market participants anticipating a firmer trend supported by high costs and lingering supply constraints. However, there is a growing consensus that the pace of increases may slow down. Many players believe that the market is approaching a point where further sharp hikes may no longer be absorbable, as demand continues to weaken, with a potential shift toward stability in June or July.

At the same time, the re-emergence of Asian volumes could gradually ease supply pressure and offer buyers more alternatives, particularly if arbitrage remains open.

Overall, while the European PP market remains structurally supported, weakening demand dynamics and improving import availability suggest that the current rally may be losing momentum rather than extending at the same pace.