European Polyurethane Resin (PU Resin) prices were flat in the first week of July 2025 amidst weak demand and rising imports while a limited recovery is expected in the near term.
Prices for PU Resin in the European market were relatively stable entering July 2025, as persistently weak demand and increasing competitive pressure from Asian imports continued to weigh on market sentiment. Participants reported that Asian-origin cargoes continued to reduce domestic European PU Resin prices, applying downward pressure on local producer margins.
Production activity within the region exhibited signs of deceleration. However, despite the decline in output, PU Resin producers were still reported to have sufficient inventories, pointing to sluggish offtake from downstream sectors and continued arrival of competitively priced imports originating from Asia.
Transactional activity in small- to mid-volume segments took place at reduced price points relative to the prior month. While isolated rollovers were noted, the overall PU Resin pricing trend remained flat, underpinned by tepid fundamentals. Export prospects for European PU Resin suppliers remained constrained, and expectations for any immediate revival in demand were muted, particularly with seasonal holidays limiting market activity.
Further intensifying the bearish pressure, PU Resin exports from China to Germany surged from 133,824 kg in April 2025 to 216,580 kg in May 2025 representing a surge of approximately 62% on month-on-month basis, according to the General Administration of the People’s Republic of China. This influx of Chinese material exacerbated competition in the European PU Resin market, leading to tighter margins for local producers.
PU Resin demand conditions remained challenging, with the construction and automotive sectors continuing to face significant headwinds. Market feedback also highlighted a persistently weak offtake from the furniture segment, as constrained consumer spending curtailed overall demand. Despite a handful of processors reporting marginal improvements in capacity utilization, sentiment across most of the PU Resin market remained pessimistic, with several players expressing minimal expectations of recovery for July 2025 due to the summer season.
PU Resin supply remained ample despite reduced domestic production with many European producers operating at lower operating rates at their compounding facilities, supported by prior imports from Asia and ongoing clearance of backlogged inventories. PU Resin Suppliers were heard offering materials at stable to slightly discounted prices, effectively preventing any meaningful rebound in market levels. Structural demand remained underwhelming, reflecting the cautious procurement approach adopted by downstream industries.
Looking ahead, PU Resin prices are anticipated to remain largely stable in the near term. However, rising freight rates from Asia to Northwest Europe—up by approximately 44% in June 2025—are likely to erode the cost competitiveness of Chinese cargoes. This may offer some relief to European PU Resin producers amid expectations of reduced operating rates in July due to seasonal plant maintenance and summer holiday shutdowns.
Nonetheless, PU Resin demand is expected to remain soft in the upcoming month, with overall market activity continuing to be subdued amid ongoing macroeconomic uncertainties and seasonal holiday-related slowdowns.
