Lower ethylene pulls down February PVC prices in Europe
Distributors in Italy started giving initial February offers with decreases between €20-25/ton for West and Central European PVC. Sellers of Central European origins are especially seeking to limit the amount of their reductions at the beginning of the new month after stepping back from their initial prices in January. One of the sellers expects to see improved demand after buyers kept their stocks low in the second half of January due to bearish expectations.
Several buyers finalized their January PVC contracts with rollovers to minor decreases of €5-10/ton, commenting that they expect PVC prices to decline by around €30-35/ton this month considering the €70/ton fall in ethylene contracts.
A converter in Belgium reported receiving initial February PVC offers with decreases of €20/ton in the contract market from a West European producer. “We think that suppliers will make further downward adjustments later in the month. We expect to obtain discounts of €35/ton in line with half of the ethylene drop for February. Demand for our end products was slow in January and we will buy less volumes this month since we don’t expect to see a notable improvement in our trading activities,” the buyer commented.
Another converter in France has already settled their February PVC contracts down €35/ton from last month with a West European supplier and reported observing similar reductions in the spot market. The buyer also received some import PVC offers, but didn’t consider them to be competitive considering the current downward trend in the local market.
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