China PVC rebound gathers pace as export tax rebate cut reshapes market dynamics

China’s PVC market has entered a pivotal phase, with a price rebound that began in late 2025 gaining further traction in mid-January amid policy-driven expectations. After emerging from historic lows in December, prices have continued to firm, with the government’s decision to cancel the 13% PVC export tax rebate from April increasingly shaping both domestic sentiment and export strategies.

According to ChemOrbis Price Index data, multiple PVC benchmarks have now sustained their recovery from record or multi-year lows, even as downstream demand remains subdued, buying stays largely need-based, and oversupply persists.

Local ethylene-based PVC extends rebound, acetylene segment lags

In the domestic market, the weekly average of local ethylene-based PVC K67 prices rebounded from all-time lows in the second half of December 2025 and has remained on an upward trajectory through this week, according to ChemOrbis data. The recovery has been supported by higher futures, rising costs, and producers’ firmer pricing stance at the start of the New Year.

By contrast, the acetylene-based PVC market has remained largely stable at all-time lows. While some mid-range offers showed slight upward adjustments, overall price levels have yet to mirror the recovery seen in ethylene-based material, reflecting weaker fundamentals and persistent demand caution.

FOB and CIF prices sustain rebound from 2008 lows

China’s export and import markets have also joined the recovery trend. ChemOrbis Price Index data show that weekly average FOB China prices for both ethylene- and acetylene-based PVC K67 rebounded from their 2008 lows in late December and have sustained these gains into mid-January.

Similarly, import PVC K67 prices reversed course from 2008 lows during the same period. While prices have stabilized in recent weeks, market expectations continue to point toward further upside.

Fresh price hikes emerge at start of the week amid policy shift

Early indications for the current week starting January 12 show fresh upward adjustments in the local market. A domestic producer’s source reported CNY150/ton ($22/ton) hikes on both ethylene- and acetylene-based K67-68 grades compared with last week.

Export prices have also moved higher at the start of the week, though trading activity remains cautious. A Chinese trader reported increases of around $20/ton on export offers for both acetylene- and ethylene-based PVC grades. “On the export front, it remains largely in a wait-and-see mode,” a source from another producer commented. Still, sentiment has been underpinned by expectations of stronger overseas interest ahead of the upcoming policy change.

Market attention is now firmly centered on China’s export tax policy shift. On January 8, the Ministry of Finance and the State Taxation Administration announced that the long-standing 13% export tax rebate on PVC will be fully canceled from April 1, 2026, covering HS codes 39041090, 39042100 and 39042200.

Overseas buyers have already stepped up inquiries, anticipating a sharp increase in the effective cost of Chinese PVC after April. “We are rushing to ship our products as soon as possible now,” a Chinese trader said, estimating that PVC prices could rise by around $100/ton once the rebate is removed.

A source from a Taiwanese producer added that Chinese suppliers may sell aggressively at lower prices ahead of April to clear inventories. However, from a mid- to long-term perspective, the rebate cancellation is expected to tighten supply and lend structural support to prices.