Asian PVC producers keep operating rates high despite weak demand

In Asia, PVC producers elected not to reduce their production levels despite weak demand coming from the buyers. Sellers attributed this to their preparations for after Chinese New Year holiday as they expect to see better demand during this period.

A Chinese ethylene based PVC producer commented, “Demand is weak in China and prices are lower for now. However, we are not planning to reduce our operating rate in the near term as we are building inventory for the post-holiday period.”

An acetylene based PVC producer in China opined, “Our current operating rate is close to full capacity. We think that the market will rebound in February as demand will improve both in China and India by then with buyers starting to make purchases again.”

A Taiwanese producer commented, “Nowadays, demand is slow in India given the currency issue while players’ inventory levels are still low. However, we are running our plant at full rates currently in order to build more inventories as we think that Indian buyers will eventually make purchases in the first or the second quarter of 2017.”