Nexant ChemSystems says PS is losing market share to PP

Nexant ChemSystems says PS is losing market share to PP

Polystyrene consumption dipped in Western Europe last year, according to Nexant ChemSystems. The consultancy estimates use of the material fell by 2%-3% in 2003, following 2% growth in 2002. Consultant Lee Fagg said: “As a mature market, one would expect polystyrene to grow in line with GDP. This isn’t happening because PS is losing market share to polypropylene – particularly in food packaging.”

Nexant expects a moderate growth in consumption this year, of around 2%. Polystyrene producers – which have seen margins disappear because of overcapacity, lower demand and higher feedstock costs – are determined to raise prices this year. Many have already cut back production, or are planning to do so.

“Margins are a long way from getting back to more acceptable levels,” Fagg said. “Higher prices are needed to restore margins.”