London (GC Intelligence) – Polymethyl Methacrylate (PMMA)’s latest data from Eurostat showed that so far in 2019 imports are lower than in 2018.
Earlier in the year, imports from Asia were increasing as the lack in demand caused oversupply in the region which led to lower prices and a greater incentive to ship additional volumes to Europe. But as the Euro weakened, demand dropped and prices decreased, the European market has been less able to absorb the extra volumes.
PMMA demand in Europe began a gradual decline at the end of 2018 and this negative trend gathered pace in Q2, pushing prices down as much as €300/mt, in some cases €400/mt.
The outlook for the next few months suggests a similar scenario if not worse. Tariff disputes is the main factor behind this market weakness, and it seems that participants are bracing themselves for a bleak 2019. It is therefore most likely that the current pattern of slowing imports and increasing exports will persist for the next few months.
While fewer tonnes of PMMA will likely be shipped to Europe, imports will remain competitive and will continue to place pressure on prices. Imports are small compared to the size of the market, but they are certainly not insignificant and can still shape negotiations.
What is more, the new plants that started production in 2018 will exacerbate the oversupply caused by ongoing weak demand.