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Indian players see PVC prices falling further ahead

by Shibu Itty Kuttickal -
  • 06/09/2023 (02:20)
Demand in India’s PVC markets has kept weakening with an apparent confidence deficit on the part of buyers even as supplies turned ample. Players see pressure on the market continuing through the month, and expectations for a Taiwanese major’s October prices call for decreases.

Availability has remained a non-issue as there are ample offers being reported from China, while some players expect a flurry from sellers of US-origin material as there are no production issues expected from the US Gulf.

Import PVC prices to India rallied by $120/ton, or about 16%, for about a month since the week ended 10 July, but were stable for the next couple of weeks before sliding by about 2% in the ensuing two weeks. Latest accounts from the market point to at least another $10/ton cut in assessed prices in the current week.

India - PVC

Import prices from China slide

Chinese sellers are offering to India in an $840-870/ton CIF range, but indications are that prices have been reduced to an $830-850/ton range for some buyers. “Buyers with some clout in the market are thought to have managed to get even lower prices from Chinese sellers than the levels posted earlier,” a trader said.

“At the same time, we see buyer interest too weak in the current market even at the lower levels. This means players are expecting still lower prices in the near term,” he added.

Availabilities for buyers keep easing

“We expect availability to be eased further in the coming weeks. US supply issues have been solved, while Asian production is also expected to be ramped up further in the coming weeks,” a Mumbai-based trader said.

“Availability is not an issue and deals could be sealed once suppliers start reducing prices further. Even currently, I don’t have a problem in supplying 5,000 tons to any genuine buyer in India if the prices are right,” another Indian trader said.

Meanwhile, a Japanese producer’s PVC K67 was being offered at a duty-free price of $910/ton, equivalent to about $840/ton for shipments dutiable at a 7.5% rate. The Japanese offers have fallen from levels of $960-980/ton in the previous two-three weeks.

Some players expect a US hammering ahead

“A major seller of US origins has told us to secure deals at whatever best prices we can get as he expects a fairly large volume to be offered to Asian markets shortly from the US Gulf,” the Mumbai-based trader said.

He said offers were few and far between at the high end, pointing to prices likely to stay under pressure in the near term.

Taiwanese October benchmarks expected to fall

A major Taiwanese producer’s new PVC K67 prices for September are $80/ton higher from August at $900/ton CIF India. The producers’ allocations, estimated in a 12,000-15,000-ton range, have been sold out for September. However, Indian players expect October offers to be at least $50/ton down from its September price at $850/ton CIF India.

“The producer had enquired its buyers their pricing ideas and we understand the highest buying idea they received was about $850/ton CIF India. At the same time, we don’t find a lot of buyers at the mid-$800s/ton currently and it looks like we’re definitely seeing a bearish trend,” another trader said.

Meanwhile, upstream support remains...

At the same time, higher energy and ethylene prices may still underpin PVC prices in the near term. A Singapore-based trader agreed the PVC market sentiment is weak. “But on the supplier side, there’s intense cost pressure, as crude oil and ethylene prices have continued to rally. We may have to watch the upstream costs as that may check any major slide in prices,” he added.
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