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Expectations of improved demand support PVC sentiment in Indonesia

  • 14/07/2016 (14:29)
PVC players in Indonesia report that expectations of better demand after the holidays will provide some support to the PVC market for August. This followed reports of a Taiwanese major raising its PVC prices for August to the Asian markets. The producer raised its offers by $40/ton to China and Southeast Asia. This increase was expected due to the upcoming maintenance shutdown at the producer’s PVC and VCM units in August.

Some players commented that buyers are expected to return to the market to replenish their inventories following holidays since they had elected to limit their purchases before the holidays due to comfortable supply levels and falling prices, factors which encouraged buyers to wait.

“Before the holidays, demand was slowing down and few inquiries were reported from our customers as the market was on a downward trend and supply levels were comfortable. Following the holidays, some buyers are still in a wait and see stance, but we expect demand to improve in August. Workers are not yet back from their hometowns. Our plant will return to normal next week, like many other companies,” reported a converter.

“Following the end of the Eid holidays, the market has yet to show major changes but demand is expected to improve in the August-September period. Most market players will only be back after holiday by next week. Demand should be better at that time since the government will release more projects now that the Eid holiday has ended. We think the August – September period will see much better demand since half of July was a holiday. We expect domestic producers may achieve increases of $20/ton following $40/ton increase announcement from a Taiwanese major. Meanwhile, we have not received new offers from a US producer who is still limiting their allocation,” reported a trader.
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