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Asian PVC buyers anticipate lower prices for July

  • 16/06/2016 (03:42)
Players in Asia report that regional PVC markets are quiet these days as most players are waiting to see new July prices from a Taiwanese major before making their next move. Buyers are currently busy trying to predict the July trend and most expectations are calling for decreases given softer feedstock costs and seasonally sluggish demand in India and several Southeast Asian countries.

“We expect to see lower prices for the coming month and we plan to skip purchasing in July if prices remain above our buy ideas. Availability is sufficient as buyers have recently taken delivery of a good amount of previously purchased import cargoes,” a trader based in India commented. A PVC compounder based in India added, “We expect to see decreases of around $30-40/ton for July and are delaying our purchases until new offers are announced. Demand for our end products is growing steadily these days and we are purchasing normally.”

Another Indian distributor stated, “Prices for locally held import cargoes are already starting to move lower while demand is softening owing to the start of the monsoon season. Softer upstream costs are also encouraging buyers to take a bearish stance on the market. We expect to see lower prices over the next two months.” An agent of the Taiwanese major operating in Indonesia reported, “Our supplier’s July allocation will be a bit limited, but we still anticipate a lower announcement for July given muted trading activity. We expect to receive the new July prices early next week.”

A distributor based in Malaysia said that they predict to see a $10/ton decrease from the Taiwanese major for July. “Demand is not strong and this is putting some downward pressure on prices. Trade is quite limited this week as most buyers are waiting to see the Taiwanese major’s new offers for July before making fresh purchases. A source from a Thai producer also predicted a $10/ton decrease from the producer for July. “Demand has slowed down in Thailand in line with the rainy season, although the seasonal slump in demand is not as pronounced as it was last year. Local supply is steady in the country,” a producer source stated.

A Chinese PVC producer also reported that they are anticipating weaker prices for July. “We are keeping our prices steady for now, but are willing to give discounts to buyers who are serious about purchasing. Spot ethylene and VCM costs have lost ground recently while demand from both China and Southeast Asia is not encouraging,” a producer source stated. A pipe manufacturer in Vietnam gave their predictions for July with a $10-30/ton reduction from June. “Our stock levels are comfortable and we are in no rush to make fresh purchases. We are planning to meet more of our needs from the import market next month as there are some shutdowns in Vietnam and we feel that this will make local deliveries less reliable,” the buyer stated.
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