Hold or Buy? ABS Prices Still Tilting in Buyers' Favor

The Korean ABS market entered Q2 2026 riding momentum built over the previous quarter, steady demand, tight supply, and a pricing floor supported by elevated feedstock costs. That confidence has since evaporated, and the shift has been swift.

The turning point came in mid-April 2026 when the Strait of Hormuz reopened. Crude oil prices declined, and styrene, which accounts for nearly 65% of ABS production costs, followed almost immediately. With that cost floor removed, ABS prices in South Korea dropped sharply by late April, one of the steepest declines seen in recent months. A brief mid-May recovery offered little relief before prices softened again toward month-end.

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What's driving the pressure?

Several forces are compounding at once. Korean producers returned from scheduled maintenance shutdowns with operating rates above 75%, pushing fresh supply into an already weak market. Meanwhile, acrylonitrile and butadiene, the other two key feedstocks, are also declining, stripping away additional cost support layer by layer.

On the demand side, downstream sectors including home appliances, automotive, and consumer goods are in a seasonal lull. Buyers are covering only immediate requirements and resisting anything above baseline pricing. Chinese-origin cargoes entering at competitive levels are making it even harder for Korean suppliers to hold firm.

Traders who accumulated inventory in Q1, expecting prices to stay elevated, are now sitting on higher-cost stock in a falling market, and cutting offers just to maintain volume.

The bigger question

Near-term, prices are expected to remain under downward pressure unless feedstock costs stabilize or buying activity picks up meaningfully. But the longer-term question matters more: if Korean ABS producers are unable to protect margins during a falling raw material cycle, how will the market absorb the next upswing, especially when buyers have already adjusted their expectations downward?

For procurement teams and traders, the current environment still tilts in buyers' favor. The window may not stay open indefinitely.

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This release was published on openPR.