At the recent European Petrochemical Association annual meeting in Vienna, the industry broadly expected European olefin supply to remain ample in 2027 despite continuous regional cracker closures, with weak demand, high costs and external competition suppressing operating rates.
Over the past 18 months, Europe has closed or announced the closure of seven steam crackers, involving about 4.5 million tonnes per year of ethylene capacity.
The cost of Europe's naphtha cracking route is significantly higher than US and Middle Eastern ethane routes, placing European units at a disadvantage in marginal pricing. Even if operating rates recover, Europe's high-cost capacity would be the last to be brought online.
The commissioning of Ineos's new ethylene plant in Antwerp will partially offset the closures, keeping Europe's total ethylene capacity in the range of 24 million to 26 million tonnes per year.
Executives at the meeting noted that the size of the European chemical market has contracted by 15% to 20%. Dow's shutdown of its Böhlen facility in Germany, TotalEnergies' closure of its Antwerp cracker and SABIC's completion of the Wilton plant decommissioning represent accelerated execution of capacity rationalization.
