In May 2025, prices of Petroleum resins kept dropping in China and the US, echoing the shared theme of oversupply and muted demand in the global markets. As China saw 2.8% month-on-month price drops in the face of sustained oversupply and poor downstream offtake, the US Petroleum resin market too struggled with poor buying interest in the wake of improved trade conditions.
In China, Petroleum resin prices were persistently under pressure as inventories continued high due to lingering demand weakness and firm supply. With relatively slight rate changes from a small number of manufacturers, production levels stayed constant and were unable to reduce overstocked stocks. Lower feedstock costs as a result of the global decline in crude oil prices improved margins but eliminated any cost-based price support for Petroleum resin. Logistics operated well over domestic routes, maintaining product flow well.听
In terms of demand, weak activity in the adhesives, coatings, and tire sectors continued, further eroded by poor weather and soft construction momentum. The decline in construction activity mirrored wider industrial deceleration, though logistical flows in China were mostly unscathed. Late-month factory shutdowns further curbed Petroleum resin demand, leaving the market facing an uneven supply-demand relationship and continuing downward pressure on prices.
In the US, petroleum resin prices too did not improve much since buyers were sticking to cautious procurement policies. Adhesive and coating makers mostly used past stocks, opting to postpone new orders due to static demand and economic reservation. Even though there was a resolution of past trade tensions with an interim suspension of US-China tariff hikes, sentiment remained subdued.
By the end of the month, some traders raised Petroleum resin purchases to offset anticipated slowdowns during China's Dragon Boat Festival in hope of taking advantage of expected export restrictions. But the move was unsuccessful in driving up prices as Chinese sellers aggressively discounted Petroleum resin to kick off sales in the face of saturation in domestic markets. That factor further curtailed the US market's desire to accept higher-priced imports, keeping total price levels in check.
In the near term, both the US and Chinese Petroleum resin markets are likely to stay soft except in case of a meaningful improvement in downstream demand. Seasonal forces like post-festival restocking and possible weather normalization may offer only modest support. Oversupply and risk-averse buyer attitudes is likely to prevail in the near term. Market players will be looking for any rebound in building activity and export orders, which may give the first indications of stabilisation in the third quarter.
