China’s local PVC markets soften for second week; export offers follow suit amid BIS risks

China’s PVC markets have entered June on a weak footing, reflecting a continued imbalance between supply and demand. Despite a mild uptick in operating rates at downstream factories, overall sentiment remains subdued in an oversupplied market. Both domestic and key export markets are heading into the rainy season—traditionally a slow period for construction-related industries—further dampening expectations for near-term recovery.

On the pricing front, local PVC prices have continued their downward trend for the second consecutive week, edging down by CNY50–100/ton ($7–14/ton). Following suit, export prices also slipped by $5–10/ton this week after showing some gains in the previous two weeks. Meanwhile, import prices have mostly stabilized, as sellers have held on to their offers after the increased June offers announcement from Taiwan last week.

Growing supply-demand imbalance dampens sentiment

The factor contributing to the bearish tone is the growing supply glut. Multiple producers and traders reported that supply remains ample following the return of capacity from maintenance shutdowns. A source noted, “Supply is still long, while there is no significant improvement in demand.” Another market participant echoed this development, warning that additional supply will hit the market in June, adding further downward pressure.

In the meantime, demand recovery has been sluggish. Despite some modest improvement in downstream operating rates, market participants continued to describe local demand for PVC as weak and stagnant. Seasonal factors such as the onset of the rainy season in both China and key export destinations, particularly India and Southeast Asia, are also expected to restrict activity in construction and related sectors.

"Market demand is expected to slow down in certain industries, and export volumes to India may decline due to the rainy season. Meanwhile, the domestic macroeconomic outlook remains sluggish, and overall market sentiment is still weak," said a source from a Shenzhen-based producer.

India inquiries pick up despite seasonal and regulatory headwinds

Interestingly, Indian demand has emerged as a relative bright spot, showing signs of recovery after a muted first half of the year, according to market sources. Players noted a pickup in buying interest from Indian importers, reporting more frequent inquiries from Indian buyers recently. This resurgence is especially notable given the overlapping headwinds of the Indian monsoon season and the looming BIS certification requirements on PVC imports.

A producer in Tangshan shared, “We’re currently less focused on the Indian market, but we’re still trying to secure more orders there. Lately, more Indian buyers have been reaching out to ask for offers.” Several traders emphasized that buying enthusiasm from India has been relatively strong in recent weeks, providing a partial offset to the overall weakness in demand.

BIS certification may hamper Chinese PVC exports to India

Despite this renewed interest, the implementation of India’s BIS certification regime poses a threat to China’s PVC export prospects. Chinese producers are reportedly still waiting for certification, while 21 companies from other countries have reportedly obtained BIS approval. This discrepancy may give non-Chinese suppliers an edge in capturing Indian market share in the near term.

Additionally, India has long been the top destination for Chinese-origin PVC, making the potential impact of recent regulatory challenges particularly significant. In the first four months of 2025, nearly 45% of China’s total PVC exports—valued at around $380,000—were shipped to India. As a result, any bottlenecks from the Indian side could sharply reduce China’s PVC outflows.

With Chinese suppliers now facing mounting obstacles, including the looming BIS certification and potential anti-dumping duties (ADDs) from the Indian government, there’s an increasing need to diversify export destinations. Otherwise, the risk of domestic oversupply could intensify. Unless there’s a solid recovery in demand and greater regulatory clarity, China’s PVC market will likely remain under downward pressure, with limited room for short-term gains.