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India PVC sentiment improves further despite lower Aug offers from Taiwan

by Pınar Polat - ppolat@chemorbis.com
  • 15/07/2021 (09:10)
India’s PVC market had a firm start to July, ceasing 10 straight weeks of declines. This was in response to the pent-up demand in the country. The sentiment has continued to improve recently despite a major Taiwanese producer’s lower offers for August.

Nonetheless, it is crucial to state that the major producer’s August pricing also justified the demand improvement in India as the new offers witnessed a relatively moderate cut when compared to up to $150/ton decreases in June and July.

The major’s August PVC K67-68 offers to India were down by $60/ton on the month to $1330/ton CIF India, with no volume discount available.

The major’s Aug quota to India quite less than usual

Several traders reported that the major Taiwanese producer sold out its August quota within the very same day of the announcement. The producer’s August quota was less than the usual amount, meanwhile.

The major has drastically reduced its monthly allocation to India, from about 21,000-25,000 tons, to less than 11,000-12,000 tons in August. “This has resulted in Indian buyers looking at other suppliers for fresh purchases,” a trader noted.

Import offers slightly down but sentiment supported by bullish factors

The overall range for import PVC K67 - 68 offers were assessed flat to $20/ton lower from last week at $1330-1450 on CIF India, cash basis.

Although import PVC offers in India displayed a softening this week after the major Taiwanese producer’s latest pricing, the sentiment in the market has continued to lend support from increasing buying enthusiasm, bullish energy values, as well as local producers’ firm stance.

Local suppliers increase offers further

Several local producers in India have applied hikes on their PVC K67 offers for the second straight week by citing better demand conditions.

According to ChemOrbis Price Index, the weekly average of PVC K 67-68 offers on ex-warehouse India, cash basis have gained a total of $14/ton to reach $1688/ton.

Some positive news about Covid; different remarks on monsoon impact

India’s battle with the Covid has been one of the most brutal ones around the world.

After the first wave in September 2020, the country faced rising daily infections starting from March 2021, with demand remaining under pressure ever since April.

As of this week, the news underlined that the number of daily infections has fallen to the lowest levels in the past four months.

A trader commented, “In India, there is a feeling that we are slowly on the path to economic recovery although there are fears of a possible COVID-19 third wave ahead. Open market prices have improved in July, along with higher demand, with a delay in the monsoon rains reaching northern parts of India considered as a positive for PVC resin sales.”

The monsoon season traditionally stretches from June to September. Requirements are decreasing in India with activity in the agriculture and construction sectors slowing down amid the heavy rains.

On the other hand, another trader operating in the local market said, “Even though the monsoon season is here, we think there won’t be further drops in PVC prices.”
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