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Shipping delays further tighten India’s PVC market; fueling the uptrend

by Shibu Itty Kuttickal - sikuttickal@chemorbis.com
by Merve Sezgün - msezgun@chemorbis.com
  • 26/08/2021 (03:11)
PVC players in Asia reported that the stock situation in India further tightened during the week due to a shipping delay that sources said was more than three weeks. The Chinese and Southeast Asian markets were also tight since sellers focused more on offering to the pricier Indian market.

The uptrend remained intact in India, where import prices rose for the fifth consecutive week.

ChemOrbis assessed K67 prices for all origins $20-40/ton higher from last week at $1520-1620/ton CIF India, cash. According to ChemOrbis Price Index data, the weekly average of prices has hit the highest level since mid-May.

A trader noted, “The current shipping delays mean cargoes that were booked late last month at below the mid-$1350/ton levels will only be delivered to buyers in east coast India by mid-September, also considering the time needed for loading, customs and other clearances. This has deepened the market tightness.”

“The shipping issue, along with the extreme tightness ahead of the post-monsoon demand, is keeping prices high. There are no offers as either sellers can’t deliver or are waiting for further price rise,” a trader added.

China, SEA markets also tight as sellers focus only on India

With India offering better netbacks, the focus of South Korean and Taiwanese sellers has turned more towards India than to Southeast Asia and China.

This week, ChemOrbis assessed K67 prices for all origins at $1310-1370/ton CIF China and at $1320-1400/ton CIF SEA, cash. The gap between CIF China and CIF India prices is currently at $230/ton, the weekly average data from ChemOrbis Price Index suggest.

“There’s little interest in offering to either Southeast Asia or China as both the markets have the lowest prices. We are hiking offers to India aggressively as USG or European deep-sea cargo arrivals into Asia are anyway unlikely,” a Northeast Asian trader said.

High coal prices, tight local supplies also support China market

In China, local PVC prices were also supported by tight domestic supply, higher coal prices, and firm Dalian futures this week.

“Domestic supply is likely to remain tight for most of September, hence there’s no inventory pressure. Plus, coal prices have risen due to restrictions on electricity usage, especially in southern provinces,” said a local supplier.
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