Asia PVC outlook for 2025: Bearish grip may start loosening in Q1

The year-end markets for PVC in Asia are in bearish clutches amid ample availability and weak demand. However, green shoots of recovery may emerge in the first quarter of 2025, spurred by seasonal buying in India for construction and agricultural demand.

Some traders said the recovery in the first quarter could be very similar to the market early in the current year being lifted by the demand in India. But others doubted whether the current economic situation offered enough steam for a sustainable increase in prices.

“We haven’t seen a lot of buying in the past few months as players were not too enthusiastic in procuring shipments, as they feared shipments would attract anti-dumping duties (ADDs) if they land after the ADDs come into force. We don’t need to risk that, especially at a time when demand is nothing great to write home about,” an Indian trader remarked. “At the same time, we expect some buying to emerge in the first quarter of the next year for demand in the construction and agricultural sectors,” he added.

China and SEA import PVC markets end 2024 at their lowest levels since May 2020

ChemOrbis Price Wizard suggests the lowest levels seen since May 2020 for import prices both in China and Southeast Asia on a weekly average basis. The slump appears to have deepened particularly after mid-November. Both markets have traded in a quite narrow range of $120-130/ton from peak to trough during 2024.

India PVC market remains elevated, prone to more fluctuations

Unlike China and Southeast Asia, the latest assessments of Indian import prices offer a decrease after three months of a stable to firmer trend with the weekly average suggesting a retreat to late September levels. The Indian market has also differed from the other two markets in trading in a larger range of $200/ton throughout 2024 from peak to trough.
India’s vulnerability stems from its larger dependence on imports, being subject to bigger price increases in times of supply disruptions caused by freight issues and/or legislative risks.


Pressure of ample availability

Import PVC prices are being pressured by ample availability in the Chinese market that has prompted a Taiwanese major to reduce its monthly offers, while market players awaited clarity on India’s anti-dumping duties later in the week.

The Taiwanese major lowered its January PVC K67 offers to India by $25/ton from December, bringing the price to $785/ton CIF, cash. Offers to China were reduced by $20/ton to $740/ton CIF, cash, while FOB Taiwan offers saw a similar $20/ton decrease, now at $700/ton.

Much ado about India’s anti-dumping duties

Meanwhile, players were awaiting final notifications on India’s anti-dumping duties which are expected shortly, especially after a court order thought to be favouring Indian producers of S-PVC who lobbied vigorously for the ADD. The players said the government delayed the ADD final notifications pending the court order.

Pending the final ADD decisions, traders have noted converters directly buying from Chinese suppliers below the mid-$700s/ton. Offers of small volumes of Chinese K67 material were noted as low as $730/ton, but trades were few and far between. And most of the Chinese offers continued to be available only for upfront cash payments.

Traders in India said Chinese exporters have significantly lowered FOB prices, enabling Indian players to consider imports at workable levels even for shipments subject to ADDs of approximately $100/ton.

The provisional ADDs announced in November ranged from $82-167/ton for Chinese imports, $25-163/ton for Taiwanese imports, $73-200/ton for Indonesian imports, $54-147/ton for Japanese imports, $51-161/ton for South Korean imports, $53-184/ton for Thai imports, and $164-339/ton for US imports.

Across Asia, both buyers and sellers were reluctant to engage in transactions that might result in additional payments after shipments were dispatched. Meanwhile, swelling inventories in China added pressure on sellers to offload shipments quickly, especially as the year-end approached, a time when players typically aim to hold less stock and more cash.

Dust may clear in the new year

At the same time, most players expect the dust to settle on the ADDs and a clear picture emerging in the market by early next year. “We may see a stable trend in most Asian market early in the new year. There is bound to be some pressure because of the availability in China as well as the rest of Asia. But we also expect the typical high demand in the first quarter of the year for PVC could keep the market supported,” a trader based in Mumbai said.

In China and Southeast Asia, too, the pressure of ample supplies on the markets could continue, but players believe the current FOB China pricing has limited room to slide further, as current prices have been trading at their 16-year lows since September. And on another front, the Chinese PVC markets could be underpinned by Beijing’s support to the housing markets in the form of stimulus measures and the promise to take these measures forward in 2025.

India sees a typical peak downstream production season in the January-April period for PVC pipes and profiles, driven by the anticipated growth in the construction sector in India ahead of the June-September monsoon season, as well as for irrigation pipes. And as is typical, the demand starts tapering ahead of the monsoon months. The next demand season starts after the monsoon ends and construction activity resumes.

Can supplies tighten enough to boost the market?

Market players in the region also expect economic measures aimed at supporting the struggling real estate sector could boost PVC demand in China. On the other hand, there is considerable supply slack that needs to be tightened in the market, which could tame any runaway bullishness in the markets. The Southeast Asian markets are also expected to pick up steam on the back of any bullishness in the Indian and Chinese markets.