In the third and fourth weeks of October 2025, the Polypropylene market in Japan remained in a downward trajectory, decreasing by 0.53% in the third week and then a faster rate of 2.66% in the fourth week, leading to a persistent 12-week sliding market, with ample availability of polypropylene in the domestic pipeline against soft downstream demand. Producers had ample inventories at 30- or 45-days, resulting in aggressive discounting. Also, U.S. bound polypropylene shipments to divert back to the domestic market due to the 15% tariff, leading to further oversupply in the domestic market. Although other factors counterbalance the oversupply to some extent, regional propylene tightness developed in the region due to outages in Indonesia and Vietnam, the slightly weaker yen was elevating naphtha costs.
During the third week of October 2025, the Polypropylene prices decline of 0.53%, continuing a 12-week bearish decline with plenty of supply and slack demand. During the fourth week of October 2025, declined sharper at -2.66% and compounded the downturn while keeping prices below the 12-week moving average. Production remained uninterrupted, and an abundance of inventory and redirected exports led to a price decline despite a degree of cost support from within the region. Uninterrupted feedstocks and flawless performance by manufacturing plants coincide directly with continued oversupply. The need for polypropylene draw down due to high inventory levels while the US 15% tariff redirected import volumes into the domestic market kept supplies well-above functional capacity with a perpetual slew of glut.
An October 31 announcement from the Bank of Japan indicated that stagnant polypropylene manufacturing stalled due to weaker currency “yen,” rising tariffs on fuel costs, and a brief tightness in propylene from outages in Southeast Asia contributed to cost push. In addition, the announced closure of Gois Japanese Polypropylene production line, and growing specialty demand related to EV/3D printing applications, contributed to supportive offsets and fed volumes into EO markets in Vietnam and Thailand. As a result of these most current developments, even though packaging offtake into the region has remained resilient, the downstream economic, trade factors, and surpluses weighed bearish on polypropylene market structure.
Packaging demand remained muted at 35%, while specialty-grade demand for uses in 3D-printing applications grew, leading to modestly increased export in those grades to Vietnam and Thailand. Supply remained plentiful, with no cracker or PDH outages at the Keiyo and Tokai complexes that could push operating rates. The polypropylene export volume was diverted to domestic markets due to the implemented 15% tariff for shipping product to the US, this contributed polypropylene oversupply.
As per ChemAnalyst, Japan's polypropylene market is anticipated to further weaken into November 2025, as surplus inventories, flat run-rates, and small drops in demand out-weigh cost pushes from regional plant outages and tariffs. Going forward, monitoring manufacturing activity, yen changes and exports will be important, as identifying future possibilities for weakness is likely that will include continued price softening, low spell of demand, and less chances of supply constraints.
