Is Europe’s PE market nearing a bottom?

In Europe, reductions of around €70/ton have passed on May PE deals amidst modest demand, comfortable supply and lower costs. Italian sellers have observed a slight uptick in buying interest compared to last month, as many buyers have returned to the market after limiting their purchases in April. In Northwest Europe, meanwhile, demand remained slack.

Following two months of decreases, players are assessing whether the market is nearing a bottom. After May declines, attention has shifted to June, where expectations mostly point to a stable to softer trend. While a rebound appears unlikely, the pace of declines may slow or even give way to stability, though cost volatility remains a key factor that could weigh on sentiment.

Pressure varies depending on grades

On a product basis, LDPE and HDPE deals experienced the largest declines, with prices posting nearly three-digit drops on a monthly average comparison. Conversely, the LLDPE market has seen a smaller decrease compared to last month due to limited availability in the region. Earlier in the month, a distributor from a West European producer noted, “Our supplier had additional spot LDPE cargoes available this month, and we managed to sell them as low as €1160/ton FD Italy. However, we are now sold out.”

In fact, regional producers were reportedly holding high inventories, which led some distributors to receive special pricing at competitive levels during the month.

US imports available for June-July deliveries

Traders, meanwhile, continue to offer their previously purchased cargoes with delivery in late June or early July. US HDPE film hit the €1000/ton DDP threshold and HDPE b/m was offered slightly below this level. MLLDPE from the same origin was offered at €1090-1100/ton under the same terms.

However, resellers pointed to the current congestion at US ports due to vessel and container shortages, which has pushed more delivery schedules into July. Some traders even cancelled part of their orders amid uncertainty surrounding the post-90-day tariff window. Buyers, meanwhile, remained largely unfazed, citing lackluster demand and the upcoming summer holidays in the region.

June outlook leans stable to softer

PE prices are likely to continue their downward trend into the latter part of the month. While a few market participants do not rule out the chance of minor price cuts before the month wraps up, the PE market is expected to hold near current levels without a meaningful rebound.

As for the near-term outlook, players are questioning whether the market is nearing a bottom, with expectations for June leaning toward a stable to slightly softer trend. Some players believe that PE prices still have room for further declines, albeit smaller than those seen in May, due to lackluster demand and comfortable supply. Nonetheless, the ongoing volatility in energy markets might hinder the expected bearish scenario, paving the way for stability, according to others. Other factors to watch include the state of demand and producers’ inventory positions as the approaching summer holiday season across the bloc might hinder trading activity further.

Doubts remain on US tariffs, respite from turmoil seems likely

Players are closely monitoring the geopolitical situation after the European Commission published the latest list, in which all major PE grades from the US—LLDPE, mLLDPE, LDPE, and HDPE—appear to be exempt. If the list is confirmed, current trade dynamics would remain in place, allowing Europe to avoid abrupt disruptions and maintain access to cost-efficient resins.