Home Latest News & Insights NEW BOTTOM: POM Prices Fall in Q3

NEW BOTTOM: POM Prices Fall in Q3

August 7, 2020
The European market is struggling to return to balance after the heavy disruptions to demand from the ongoing pandemic.

Polyoxymethylene (POM) prices reached a new bottom in Q3 after registering yet another price decrease. Basic Resin POM decreased €60/mt from Q2 to Q3, according to GC Intelligence price assessments.

Trademark POM which is normally more resilient also posted losses, namely €85/mt. But homopolymer POM prices rolled over as there was more resistance from sellers.

The decreases in Q3 followed smaller decreases in Q2. However, depending on the starting point, some buyers managed to secure very big decreases in Q2. It seems the pandemic and subsequent lockdowns continue to fuel the oversupply in Europe.

POM prices in Europe have been on a downward trend since 2019, driven mainly by a weak auto and industrial sector.

Demand appears to be improving from the lowest point as some of the worst-hit players noted they resumed operations. However, many are still producing 20-30% below 2019 levels. Even if 2019 was not such a great year for POM demand.

POM prices will probably settle around current levels for the rest of the year. While further falls are not expected, a recovery amid increasing uncertainty over the virus is also unlikely.

September is a crucial month for the auto sector. If producers manage to decrease stocks and consumption increases, then it is possible that there could be a stronger than expected recovery. Therefore, prices could start to increase as early as Q4. But for now, while there are signs of recovering demand, overall the market remains rather depressed.