Türkiye PP outlook for 2026: A two-speed market may emerge after a volatile reset

PP is set to enter 2026 on a slightly firmer note after one of the most bearish years in recent memory. What began as a supply-led rally in early 2025 quickly gave way to a prolonged downside correction, shaped by weak derivative demand, aggressive pricing from new capacities, geopolitical shocks, a US-led tariff war, and rare but abrupt swings in upstream costs.

Prices declined for most of 2025, with January and June standing out as brief exceptions, when traditional early-year restocking and geopolitical jitters briefly tilted the balance in favor of sellers.

As the dust settles, the key question for 2026 is not a sharp recovery, but the emergence of a more balanced and differentiated structure across grades, origins, and end-use segments—a scenario many players deem more likely.

2025 in hindsight: A year of prolonged bears

The year 2025 opened on a firm footing for Türkiye’s PP market, supported by depleted inventories, restricted Saudi and Russian allocations, and producers’ determination to recoup margin losses from late 2024. Homo PP led the uptrend, with raffia and fibre prices climbing swiftly, while copolymers lagged amid weaker demand and competitively priced prompt cargoes. However, this bullish phase proved short-lived. By late Q1, Ramadan lethargy, cooling derivative activity, and softening oil prices began to cap upside, setting the stage for a broad-based correction that dominated most of the year.

According to ChemOrbis Price Wizard, import PPH prices fell to a 5.5-year low before stabilizing through modest hikes in December, while PPBC weekly averages sank to a record low. More recently, rising freight rates have helped the product regain some firmness.

Demand: Structurally cautious, tactically reactive

Demand conditions in 2025 were characterized less by outright collapse than by persistent fragility. Converters largely confined purchases to hand-to-mouth needs, constrained by high financing costs, limited credit access, and subdued export orders—particularly to Europe. Periodic restocking waves did occur, but these were typically driven by supply fears, freight spikes, or geopolitical headlines rather than genuine end-use recovery. Copolymer demand, tied more closely to domestic consumption in packaging, housewares, and automotive applications, underperformed homo PP throughout the year.

Supply dynamics: Saudi dominance challenged at the margins

Saudi Arabia remained Türkiye’s primary PP supplier in 2025, shaping both pricing and availability—particularly for homo PP grades—supported by Advanced Petrochemical’s expanded capacity. However, the year also highlighted the fragility of this dominance amid rising competition.

South Korean suppliers repeatedly disrupted the market, most notably in PPBC injection, eroding traditional premiums and forcing Middle Eastern producers to concede ground. As a result, Saudi Arabian PPH prices swung by $185–200/ton from peak to trough, while PPBC injection prices plunged by around $215/ton. Looking ahead to 2026, global PP supply is expected to remain ample amid ongoing Chinese capacity additions, limiting the scope for sustained rallies unless demand surprises to the upside.

Pricing behavior: Price wars hit PP copolymer

Pricing strategies in 2025 evolved markedly over the year. A key development was the collapse of the PPBC injection premium over PPH: the spread between Saudi Arabian PPBC injection and PPH narrowed from around $130–150/ton in late 2024 to as low as $15–50/ton at several points in mid-2025, and even briefly inverted in spot deals.

Meanwhile, key psychological thresholds—such as $850/ton CIF for dutiable PPH raffia and $900/ton CIF for PPBC injection—were broken during the downturn, underscoring intense competition amid rising global volumes. These dynamics reflected both weak copolymer demand and aggressive Far Eastern offers, and are likely to leave sellers more cautious in 2026, prioritizing volume defense and grade-specific flexibility over broad-based price leadership. At the same time, capacity rationalization among South Korean producers, driven by persistent margin erosion, could prove a turning point, helping to stabilize spreads and partially restore profitability.

Trade flows: China stays peripheral, S. Korea boosts exports

Despite China’s massive capacity additions and its role as a global PP exporter, its footprint in Türkiye remained marginal in 2025. According to ChemOrbis Stats Wizard, China shipped only around 1,600 tons of PP to Türkiye in January–October 2025, versus roughly 1.6 million tons of total PP imports over the same period, leaving its market share statistically negligible. This was largely due to unfavorable netbacks when comparing CFR China prices with CIF Türkiye levels, as well as volatile and at times elevated freight rates from Far East Asia. Instead, competitive pressure came mainly from South Korea, whose duty-free status and tactical pricing—particularly in PPBC injection—proved far more disruptive.

Unless freight structures or arbitrage economics shift meaningfully, China is expected to remain a peripheral direct supplier to Türkiye in 2026, even as its influence continues to be felt indirectly through global price benchmarks and oversupply concerns.

During the January–October period of 2025, South Korea increased its share of Türkiye’s total PP imports to 18%, becoming the second-largest supplier. In the same period last year, the country ranked third after Russia with a 12% share.

The United Arab Emirates has also joined the competition in PP copolymer. Emerging as a strong rival to Saudi Arabia and South Korea, the country increased its market share in Türkiye to 9% in the first ten months of 2025 from 8% in the same period last year.

As a side note, European PPH cargos were largely deemed unworkable throughout 2025, as the €/USD parity appreciated by around 12% year to date. Despite new capacity additions in Greece, elevated operating costs prevented competitive pricing flows from Europe to Türkiye.

Grade differentiation: Homo PP retains relative resilience

One of the clearest lessons from 2025 was the relative resilience of homo PP compared with copolymers throughout the year. Raffia and fibre benefited intermittently from export-linked demand, restocking waves, and seasonal support, allowing them to recover footing more quickly during both the early-year upcycle and the mid-year stabilization phase. In contrast, PPBC injection remained structurally weaker, weighed down by sluggish domestic consumption and persistent competitive pressure from duty-free Far Eastern imports.

On a full-year basis, Türkiye’s premium over China for homo PP narrowed markedly from around $180–200/ton in Q1 to below $100/ton in the second half of the year, occasionally approaching parity during periods of aggressive pricing. This narrowing arbitrage helped establish a floor for PPH prices and limited further downside, while copolymers continued to lag, as reflected in the sustained erosion—and at times collapse—of the PPBC premium over homo PP toward year-end.

2026 outlook: Constraints remain binding, recovery to take time

Türkiye’s broader macroeconomic environment remained a binding constraint throughout 2025, overshadowing traditional seasonal patterns. High inflation, elevated interest rates for much of the year, and liquidity tightness curtailed converters’ risk appetite. While regulatory adjustments—such as easing FX payment restrictions—offered some relief, they were insufficient to trigger a decisive turnaround. Heading into 2026, any meaningful improvement in PP demand will hinge not only on global polymer fundamentals but also on domestic financial conditions and exporters’ competitiveness.

Looking ahead, January seems to be prone to some price gains traditionally, whereas Türkiye’s PP market in 2026 is more likely to experience a two-phase trajectory rather than a uniform recovery. In the first half, global oversupply, China’s continued self-sufficiency drive, and persistent competition among Middle Eastern and Asian suppliers are expected to cap upside potential and keep prices within relatively narrow ranges. However, sharply lower prices in 2025 have already enforced margin discipline and curtailed aggressive selling, suggesting that downside risks may be more limited than last year, particularly considering reduced South Korean and European capacities amid restructuring moves.

On the macro side, expectations are more constructive for the second half of 2026. Türkiye’s GDP growth is widely forecast to hover around 3–4%, supported by easing monetary conditions, gradual normalization in credit access, and improving export prospects as Europe stabilizes. Inflation is expected to decelerate further, which could help revive consumer confidence and downstream plastic consumption. Under this scenario, PP demand—particularly for packaging, nonwovens, and export-linked fibre applications—could show a more tangible recovery toward late 2026.

Overall, the most probable scenario is a market that slightly firms up in early 2026 but then cools off in mid-to-late Q1 before transitioning into a selective, demand-led recovery later in the year. Rather than a broad cyclical upswing, gains are likely to be uneven across grades and applications, rewarding agile players who align procurement and sales strategies with improving macroeconomic signals rather than relying on cost-driven rallies alone.