Asian players expect another month of PVC hikes

Players in Asia are predicting another month of PVC price hikes, although the rate of increase is expected to slow down following the rapid increases observed over the past two months, as per Chemorbis. While PVC supplies remain tight, more material is expected to be available next month as several plants in Japan and Southeast Asia will resume production. Traders in China report that they have heard that some Japanese sellers plan to re-enter the market soon. Japanese PVC has been largely absent from the Chinese market since the March 11 earthquake. In China’s import market, May business for mainstream Asian origins was settled last week at prices US$20-75/ton higher than April done deal levels, which had settled with US$65-110/ton increases from March. For June business, players are currently predicting that producers will announce initial June prices with increases of around US$20/ton from May as supply from Japan is expected to ease in the coming month and local availability remains sufficient. Chinese producers have been exporting in larger than normal amounts over the past month due to more competitive prices in overseas markets when compared with the domestic Chinese market. In Southeast Asia, players are waiting to hear official announcements on local PVC pricing for May next week, with most players predicting further increases, albeit in smaller amounts than the US$80-138/ton increases observed in local prices for April. After local prices had increased by a cumulative amount of MYR800/ton (US$269/ton) over the course of the past month, Malaysian producers have left prices unchanged last week owing to renewed resistance from buyers as well as some loosening in local supply. Domestic PVC prices were also steady over the past week in Vietnam, with distributors commenting that supply is not as tight as it had been last month as a domestic producer has recently restarted its plant and the country is being well supplied with import offers for Chinese and Japanese PVC. In India, local PVC prices have posted comparatively modest increase of INR540-3238/ton (US$12-73/ton) over the past month in comparison with PVC prices in China and Southeast Asia as demand has been disappointing. A domestic producer predicted that prices would be largely stable next month as their sales volume for April was around 15-20% below their expectations. A converter reported that distributors were willing to agree to discounts of INR500-1000/ton (US$11-23/ton) on their offers in to conclude deals last week while adding that they elected not to purchase any material as they are feeling satisfied with their stock levels. The demand outlook for India is seasonally slow for the months ahead as PVC consumption inside the country generally declines during the monsoon season.
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