In H1 December 2025, South Korea maintained a stable polyolefin elastomer (POE) market with steady pricing and strong inventory control between buyers and suppliers. Manufacturer information and supply practices established a predictable distribution point for both domestic and international customers, thus reducing volatility in the POE market and building confidence for both groups when making purchasing decisions.
During H1 December 2025, some of the key market factors that generated POE demand were strong. Domestic Production continued to produce near capacity and is being supported by consistent operational capacity from each major Ethylene producing company across all major POE Manufacturing Facilities. Through the operational discipline of each Polyolefin Producer, the transition from the November Production to the December Production was seamless and without interruption. The continued availability of Polyolefins is also positively impacted by the continued availability of feedstocks, especially Naphtha, which has had significantly minimal fluctuation in the price of Naphtha and consequently, very limited upward pressure on POE prices.
In the supply chain, contract obligations to prioritize transactions rather than relying on the short-term spot market to mitigate volatility in pricing through a non-linear approach. According to Statistics Korea, exports of ethylene copolymers from Korea fell by 20.15% in October 2025 compared to 70358 metric tons in September of that year. China's POE industry has shown rapidly increasing growth. China expects to produce over 640,000 tons a year by Q4 of 2025 and an additional 330,000 tons a year by the end of 2026. The demand growth for Photovoltaics, Automotive, Foam Footwear and Wire and Cable will drive demand for the Chinese POE market resulting in increased import substitution and the ability for self-sufficiency.
From the demand side, In November 2025 South Korea's manufacturing sector had a second consecutive month of diminishing production output and decreasing orders received from customers. The automotive sector offered some support; however, new vehicle sales reached 115933 units, a 13.25% increase from October. Overseas demand was also generally balanced; while vehicle sales dropped in India 17.97%, extensive government investment into Infrastructure such as Highway Infrastructure (INR260BN) and Commercial Real Estate (INR192BN) contributed to an increase in Polymer Consumption within Construction & Industrial Markets due to the existing boom in both sectors of the economy. Auto sales in China reached 3429000 units but gradual declines in construction output affected further increases in demand. Vehicle sales in Japan dropped, totaling 389721 units, as there was little activity in both residential and commercial construction, protecting the standing demand for POE shipments between South Korea and Japan, which fulfilled their contractual obligations.
According to ChemAnalyst's expectations for POE, the short run will see price stability in the near future. This price stability in the POE price is due to an anticipated slight uptick in demand, as well as steady inventory levels, and supplies of Ethylene which is expected to create a marketplace conducive to balanced POE pricing in the future.
