Asian PVC players hold firm expectations for June
In April and May, a major Taiwanese producer’s PVC offers to China and India witnessed cumulative decreases of $80/ton and $100/ton, respectively.
In these countries’ spot markets, meanwhile, import PVC prices have already bounced back from their multi-year lows since two weeks ago.
China’s PVC sentiment boosted by tightness
In China, PVC supplies have been tightening owing to planned/unplanned shutdowns amidst the government’s stricter safety measures after fatal chemical plant blasts. As a result of lower supply levels, Chinese producers have adopted a firmer stance on their local and export offers.
Additionally, high coal prices and firm PVC futures have also added to this firming trend recently. September PVC futures on the Dalian Commodity Exchange were CNY80/ton ($12/ton) higher on May 8 when compared to the latest trading session of April.
According to data from ChemOrbis Price Index, China’s local PVC markets, including ethylene and acetylene based K67, have reached their highest levels since June 2018.
Healthy demand in India
Players in India’s PVC market reported that sentiment was strong on the back of buoyant demand amidst local producers’ low supply levels. “India’s strong buying appetite coupled with limited availability is likely to encourage major PVC sellers to adopt a bullish stance on their offers for June,” a trader noted.
A source from a domestic producer also opined, “The sentiment is firm nowadays. However, the monsoon season is approaching hence we will closely monitor the stance of demand in the upcoming weeks.”
What caps expected June hikes?
Despite strong demand and limited supplies in India and China, overall June expectations have centered on modest increases ranging from $10/ton to $30/ton. This is mostly because players preferred to be cautious when sharing their opinions given the approaching monsoon season in India, the Ramadan lull in Southeast Asia and the recent downturn of crude oil futures
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