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Eyes on India's pending ADD ruling following Taiwanese PVC major's Oct pricing

by Shibu Itty Kuttickal - sikuttickal@chemorbis.com
  • 26/09/2024 (02:30)
Did the major Taiwanese producer factor in India’s impending anti-dumping duties (ADD) decision on PVC imports when it opted to keep its benchmark import prices unchanged for October? Indian players speculated that the anticipated ADD ruling may have influenced the major producer’s decision, as many market participants had otherwise expected prices to decline.
The Taiwanese producer delayed its October pricing announcement until late September as the market awaited the outcome of India’s ADD investigation. This probe, initiated in March, targets PVC suspension resin imports from several countries, including China, Indonesia, Japan, and the US.

Taiwanese major’s Oct import pricing stable

After a two-week delay, the producer announced its October offers on September 24, keeping PVC K67-68 import prices at the previous month’s levels at $800/ton CIF India, $780/ton CIF China, and $805/ton CIF Southeast Asia. At the same time, the producer raised its export prices by $25/ton to $730/ton FOB Taiwan.

“Players in the Indian market were expecting the major to reduce prices — we felt prices could fall to $770-780/ton levels. And it was difficult to find a PVC player with a bullish view in India,” a trader in Mumbai said. “The expectation the government decision on ADD could be notified by the end of the current month could have swayed the Taiwanese major’s import price rollover,” he added.

Meanwhile, the new $800/ton India CIF level from the major producer represents a $20/ton increase on the high end of India’s overall import range. The market had been dominated by lower-priced Chinese offers at as low as $730-740/ton CIF during the week ending September 20.

Low-end pricing stays at previous levels

“We haven’t yet seen any change in PVC offers to India yet. The low-end pricing has so far remained unchanged at $730/ton CIF India. We think there could still be concerted bids at the low ends, or even below those levels in the next few days,” said another trader in India, late in the day, after the major announced its October pricing. According to him, availability stayed ample in the country and the post-monsoon demand was yet to be felt.

Expected ADD decision quietens activity; uncertain outlook prevails

Market activity in India was subdued in recent weeks, with few players looking to buy or sell ahead of the ADD decision. Players in the country expected the latest offers from the Taiwanese major to draw buyers and its allocations to be sold out quickly. However, there was no indication on the actual allocations to the Indian market at the time or writing.

The producer’s rollover could also have been influenced by an uncertain market outlook, with differing opinions on what the delayed ADD decision could signal for October. Some players in Northeast and Southeast Asia did expect a rollover, anticipating that K67 prices had likely bottomed out and the market was poised for consolidation.

In India, oversupply concerns and the potential for a post-monsoon demand recovery were expected to offset each other. If other regional suppliers, particularly from China, follow the Taiwanese major’s lead, prices could see a modest rebound next month, though the strength of demand will be crucial.

SE Asia sees some lower import offers

Downstream buyers in Southeast Asia expressed a lack of confidence. “Both regional and domestic demand have stagnated for an extended period. We expected either a rollover or slight reductions in import offers. Some import prices have indeed edged lower this week, while domestic offers have held steady,” a Philippine converter said.

In Vietnam though, a trader lowered its import offers by $10/ton during the week. “We’ve heard US offers at $695/ton CIF. We were thinking that the Taiwanese major may lower prices as the demand remains weak,” the trader said.

In China, import K67 offers were mostly stable over the past few weeks. “Supply is still abundant, and demand remains weak, resulting in limited deals. We have a downbeat outlook for the PVC market as demand remains sluggish and futures continue their downward trend. We expect the market to stay flat to soft in the near term,” a Chinese trader explained, pointing to persistently high inventory levels in the local market.
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