Ethylene is one of the most important building blocks of the global petrochemical industry. It is used in producing plastics, packaging materials, solvents, and many other items that are part of everyday life. Because of this, any change in Ethylene prices directly affects downstream industries such as polyethylene, ethylene glycol, and other derivatives. Keeping an eye on the Ethylene Price Trend is not just important for manufacturers but also for traders, policy makers, and businesses that depend on the chemical supply chain.
In the second quarter of 2025, the Ethylene market went through a noticeable downturn. Prices weakened across both Asian and American markets, largely due to oversupply and persistent weak demand. This decline was not sudden but the result of a combination of factors, including high operating rates in Asia, competitive imports from the Middle East, feedstock cost movements, and broader global economic pressures.
Price Movement in Q2 2025
According to recent data, Ethylene prices in South Korea averaged around USD 760.53 per metric ton at FOB Busan. This marked a quarterly decline of about 10.38%, showing how much pressure the market was under during this period. In the United States, the price fall was even sharper. Ethylene prices there averaged about USD 434.33 per metric ton at FOB Houston, representing a steep drop of nearly 29.58% compared with the previous quarter.
Such large declines in a short span reflect how difficult Q2 was for Ethylene producers. Both markets suffered from bearish sentiment, with buyers unwilling to purchase beyond their immediate needs and producers unable to control oversupply.
Oversupply and Weak Demand
One of the biggest reasons behind the falling Ethylene Price Trend in Q2 2025 was the problem of oversupply. In Northeast Asia, high cracker operating rates continued, which meant plants were producing more Ethylene than the market could absorb. Downstream demand, especially from key industries like polyethylene and monoethylene glycol (MEG), did not match this supply.
When supply is greater than demand, prices naturally fall. That was exactly the case here. Even though production stayed strong, end-user industries were not buying enough to keep the balance. This left producers with more material on hand and forced them to sell at lower prices.
Regional Influences
The Ethylene market across different regions showed some similarities but also unique challenges.
-
South Korea and Asia: Prices remained under pressure due to a combination of oversupply and slow buying interest. Export competition from the Middle East also weighed heavily on the market. With so many suppliers targeting the same group of buyers, sellers had to reduce prices to remain competitive.
-
United States: The situation was even more severe. Prices dropped sharply as cost support from feedstocks like ethane and naphtha weakened when global crude oil values declined. US production remained steady, but weak domestic demand and limited export traction created a supply glut. With fewer opportunities to sell overseas and soft demand at home, producers faced significant challenges.
-
Middle East and Southeast Asia: Exports from these regions kept flowing into Asia, further saturating the market. With multiple options available, buyers had the upper hand in negotiations, pushing sellers to cut prices or offer discounts to secure contracts.
Impact of Crude Oil and Feedstock Costs
The Ethylene market is closely tied to crude oil, since oil-derived products like naphtha and ethane are key feedstocks. In Q2 2025, crude oil prices weakened, and this reduced production costs. Normally, lower costs could be a positive factor for producers, but in this case, it only highlighted the imbalance.
With lower feedstock costs, producers could continue running plants at high rates without facing high expenses. However, since demand was already weak, this only increased oversupply in the market. Essentially, cheaper production did not help stabilize prices—it allowed more material to flood the market, worsening the situation.
Buyer and Seller Behavior
Throughout Q2, both buyers and sellers adopted cautious approaches. Buyers showed little urgency in making purchases, often relying on existing stocks rather than committing to long-term contracts. This was possible because storage availability in major hubs remained sufficient, ensuring supply security.
On the other hand, sellers faced stiff competition. With so many suppliers in the market, they had to lower prices or offer favorable terms to maintain their customer base. In both South Korea and the US, price undercutting became common, with suppliers focusing more on moving product than on maximizing profits.
Market Sentiment and Procurement
The general sentiment in the Ethylene market during Q2 2025 was bearish and cautious. Procurement activities were mostly need-based, with little speculative buying or stockpiling. Companies only purchased what they needed to keep operations running, avoiding large commitments due to the possibility of further price declines.
This wait-and-watch approach by buyers kept trading activity muted. Even though material was available, the lack of strong buying interest prevented any meaningful recovery in prices.
Broader Implications
The decline in the Ethylene Price Trend has broader implications for the global chemical and plastics industry. Since Ethylene is a fundamental raw material for many products, its price movements directly influence the cost structures of downstream goods. Cheaper Ethylene could mean lower costs for producers of plastics and solvents, but it also signals weak demand in the overall economy.
For exporters, particularly in regions like the Middle East and Southeast Asia, the price decline means tighter margins. For buyers, however, it provides more room to negotiate favorable contracts. The balance between these two sides will continue to define how the Ethylene market evolves.
Outlook for Coming Quarters
Looking forward, the Ethylene market will depend on whether demand can pick up to match the high levels of supply. If downstream sectors such as polyethylene production or automotive-related plastics see stronger consumption, it could absorb some of the excess supply and support prices.
👉 👉 👉 Please Submit Your Query for Ethylene price Trend, demand-supply, suppliers, forecast and market analysis:https://www.price-watch.ai/contact/
However, if the same conditions of oversupply, competitive imports, and weak crude oil values continue, the bearish trend may persist. The key factors to watch will be crude oil movements, cracker operating rates in Asia, and the pace of demand recovery in the US and Europe.
Conclusion
In summary, the Ethylene Price Trend in Q2 2025 was defined by steep declines across both Asian and American markets. Prices in South Korea fell by over 10%, while in the US they dropped by nearly 30%. Oversupply, weak downstream demand, competitive imports, and lower crude oil values all combined to create a challenging environment for producers.
Buyers remained cautious, focusing only on immediate needs, while sellers engaged in intense competition, often undercutting prices to move material. With storage levels stable and inventories sufficient, there were no major disruptions, but the overall tone remained bearish.
Going forward, the market will be shaped by how demand recovers and whether supply can be adjusted to bring back balance. Until then, the Ethylene market is likely to remain under pressure, with buyers holding the advantage in negotiations.
About Us:
PriceWatch is an independent price reporting agency delivering real-time, data-backed insights into global commodity markets. We specialize in tracking raw material prices, market trends, and supply-demand shifts, helping manufacturers, traders, and procurement teams make smarter, faster decisions. With AI-powered forecasts and 10+ years of historical data, we turn volatility into opportunity.
Contact US
PriceWatch
Corporate Head Office: Futura Tech Park, C Block, 8th floor 334, Old Mahabalipuram Road, Sholinganallur, Chennai, Tamil Nadu, Pincode - 600119.
Email: sales@price-watch.ai
Website: https://www.price-watch.ai/
Comments
0 comment