Acetylene-based PVC faces additional pressure from soaring coal in China

China’s acetylene-based PVC market is nowadays facing further upward pressure from soaring coal prices in the country. According to media reports, coal futures have recently hit an all-time high due to tighter supplies and unexpected demand as the government re-allowed the use of coal for heating purposes amidst natural gas shortages.

Data from ChemOrbis Price Index suggest that China’s acetylene-based PVC market rebounded from its five-month low two weeks ago and domestic prices have been recording increases since then. This rebound was mostly triggered by firmer futures and limited supplies in the midst of the ongoing environmental inspections in the country.



A trader based in Hangzhou commented, “Domestic offers for acetylene-based PVC have been firming up for the last two weeks owing to higher PVC futures as well as limited supplies in the spot market. Tighter environmental inspections are also affecting the market since many PVC producers and converters have to limit their operating rates. On top of these, the recent surge in coal prices is likely to put further upward pressure on the market. Despite the fact that demand is fading in line with the season, we expect PVC prices to preserve their current trend.”

A source from an acetylene-based PVC producer also opined, “The impact of the use of coal for heating depends on the region. It is widely effective in Shandong, where coal is widely used while no impacts are felt in Tangshan.”