Turkey PVC market faces downward corrections on lethargic demand

Import PVC prices opened the month of November on a firm footing in Turkey. Most European suppliers applied new hikes blaming their limited quotas and rising utility costs. Although the significantly higher ethylene contracts lent support to suppliers, the lethargy in demand gained further prominence and overshadowed supply constraints from the neighboring Europe.

The duty free offers on the high end, which stood at/close to $2400/ton CIF Turkey, could hardly turn into deals except for a couple of cases. A few transactions have been affirmed at $2330-2350/ton. The rumor has it a West European producer revised its initial K67 offers from $2400/ton to $2300/ton in response to resistance from Turkish players. This was not widely confirmed at the time of press, however.



Fading demand takes center stage in Turkey

Prices have come off their all-time peak. This was a reflection of the fatigue that buyers have been experiencing following 3 months of successive hikes. The rally sent Turkey’s import K67 markets to above all other outlets including China, India and Europe back in Q3 and early Q4.

During the relentless rally in August-October, duty-free K67 prices on CIF Turkey basis posted a cumulative increase of $735/ton (45%). Dutiable offers with the same terms surged $705/ton (46%) in total.

Egyptian PVC back, yet deals appear scarce

After a long absence, an Egyptian source returned to the market with offers at or slightly above the $2300/ton CIF Turkey threshold for December shipments. Despite its competitive edge with respect to European offers, this level have not boosted enthusiasm among buyers so far.

“Our buy idea stands at around $2200/ton CIF for Egyptian cargos since we foresee further drops in December for PVC,” a PVC converter reported to ChemOrbis.

US PVC offers see sizable corrections on improved supply

American K67 offers saw downward adjustments shortly after initial sell ideas were voiced above $2250/ton CIF, subject to 6.5% customs and 32.93% AD duty.

“We have heard Formosa, Westlake and Oxy offers in tandem with improving export quotas and reasonable freight rates from the USA. Interest for these cargos was still low since buyers are reluctant to engage in distant cargos or use their re-export documents,” opined players.

Last week, US PVC K67 offers were reported between $2200-2250/ton while prices retreated to below the 2200/ton mark in most cases to be reported at $2130-2170/ton with a weekly cut of $70-80/ton on the week.

Tempting netbacks attract alternative sources to Turkey

Sliding price levels in Egypt, China and India also weighed on the sentiment in Turkey. Offering the highest netbacks across global markets, Turkey attracted irregular origins like Brazil. Players reported, “We are hearing lower South Korean offers since Eurasia Window Fair in early November in tandem with bearish expectations about a Taiwanese major’s December pricing.”

So far this week, Turkey’s duty free K67 market has been assessed $30/ton lower on the week at $2300-2350/ton CIF Turkey, cash, while dutiable offers were down by $50-60/ton to $2130-2200/ton subject to 6.5% duty.