Will May PVC hikes receive support from supply in Europe?

The European PVC market maintains its upward note for a second straight month as new May prices have emerged higher, supported by firmer feedstock costs. Following increases covering the entire ethylene hike in April, PVC sellers are seeking to achieve increases larger than half of the €40/ton rise in May ethylene contracts.

A West European producer raised their PVC prices by €60/ton for May after closing their April PVC contracts with increases of €50/ton. A producer source commented, “We are aiming for increases larger than the ethylene hike to recover our margins. Demand is good so far and it’s in balance with supply, though some suppliers experienced production outages. We aren’t planning to step back from our prices during the month.”

A South European producer applied increases of €25-30/ton on their May PVC prices in the spot market. A source from the producer reported, “Demand was good in April and supply is regular while we aren’t under any sales pressure.”

In France, a distributor is giving May offers for Central European PVC up €30/ton from last month. The seller commented that demand is improving from the compound sector while it remains stable in the pipe industry, adding that availability is limited from his supplier. According to him, the outlook is firm for the medium term.

A buyer in Germany has already closed his May PVC contracts with increases of €20/ton in line with half of the ethylene hike and said that he didn’t face any issues regarding supply for now.
In Italy, a distributor lifted his May PVC prices by €30/ton after applying price hikes matching the entire gain in ethylene contracts in April. The seller commented that supply is regular and that he is waiting to receive feedback from buyers.

Some buyers closed their April PVC contracts with increases of €50/ton. A converter expressed his buy ideas for May with increases of €25-30/ton while another buyer commented, “Our suppliers are mulling over reflecting the €40/ton rise in ethylene costs to their PVC prices entirely considering their limited supply. We will make new price inquiries this week.”

Despite reports of limited availability on the part of a few suppliers, some PVC plants have returned to production recently. Vinnolit was expected to restart their 160,000 tons/year PVC plant at Knapsack, Germany on April 29 after maintenance. Ineos reportedly completed a maintenance shutdown at Tavaux, France in the first half of April. The plant has a PVC capacity of 300,000 tons/year. Czech Anwil also resumed operations at Neratovice in the second half of April. However, market sources reported that production at the 135,000 tons/year PVC plant was reduced due to an ethylene shortage.

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