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September 27, 2019

LONDON (GC Intelligence) – Polycarbonate (PC) demand in September was weaker than expected. There was some improvement from the summer but by and large buying has been slow in most segments.

As construction heads towards the winter months, some slowdown is expected in this sector. Polycarbonate market participants in the sector noted a reduction in activity of around 10% between 2018 and 2019.

The slowdown in economic activity across most countries in Europe is largely to blame for this decrease in demand.

The automotive industry has been struggling throughout the year and recent data confirm this. The European Automobile Manufacturers Association (ACEA) reported a decrease in new car registration numbers of 8.4% in August 2019 compared to a year ago.

However, it is important to note that in August 2018 there was a surge in demand as discounts were offered to consumers to alleviate bottlenecks in supply ahead of the Worldwide Harmonised Light Vehicle Test Procedure (WLTPs) the following September.

Nevertheless, from a polycarbonate perspective, current market feedback suggests a struggling automotive sector and a very weak demand.

Other market segments such as electrical and electronics, consumer goods and industrial goods were performing better a few months ago but now are also under pressure and in line with the slowdown in current economic slowdowns.

The outlook on demand is negative. There is little significant improvement regarding trade disputes and Brexit remains a potential disaster, more so as the deadline of 31 October is soon approaching.

Taking into consideration all these developments, it is hard to see how a rebound could come about in 2019 or even in 2020.

Moreover, the ongoing headlines of monetary easing and calls for fiscal stimulus suggest that worries of a recession have increased. As such buyers will likely remain on the sidelines for some time.

NOTE: For price levels, forecasts, and a more in-depth analysis take a look at the GC INTELLIGENCE® Market Reports…