Gap between Turkey’s and Italy’s PVC market remains low
European PVC k67 prices reported in Turkey are on CIF, cash terms, not including any customs clearance and inland transportation costs, while Italy’s local PVC prices are for prompt cargoes including all duties if applicable and delivery cost to buyers’ plants. Therefore, Italy traditionally carries a premium of around $100-200/ton over Turkey; however, this has not been the case in the past 8-10 weeks.
This smaller than usual gap between the two markets can be interpreted to mean that European suppliers may shift their regular export volumes to Turkey in an attempt to hold their domestic markets firm in June, particularly if strikes end and supply concerns diminish.
The consistent lack of supplies from Europe to Turkey caused PVC prices to gain ground steadily up until three weeks ago. However, the Turkish PVC market is now facing pressure from stagnant demand, falling Asian and US offers as well as easing supply concerns in the local market. Accordingly, whether European PVC suppliers will hold firm and supply smoothly to Turkey or not is considered an important factor among Turkish players to set the tone of the market in June.
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