Local PVC markets stable to firmer in SEA

03-May-12
Domestic producers in Indonesia and Thailand have revealed their PVC prices for May with price hikes while a Philippine producer announced rollovers from last month, as per the pricing service of ChemOrbis. A stable to firmer trend is also in place in the Malaysian market. However, complaints that demand has started to taper off in some countries have been heard. In Indonesia, a domestic producer reported, “We have raised our PVC offers by $10-30/ton to the local market, where demand is stable and supply is regular.” A second producer also reported lifting its offers by $10-20/ton, saying “We stopped our export allocations almost six months ago as demand remains good inside the country.” A pipe manufacturer receiving the new domestic offers also reiterated the comments about good demand, noting that their business is performing well. However, he mentioned that they bought sufficient amounts of material last month at lower levels and they are not considering buying more these days. In Thailand, a domestic producer has also raised its local offers by THB500/ton ($16/ton) for May, as per ChemOrbis. A company source mainly attributed their hike decision to the higher offers in global markets. Nevertheless, he pointed out that local demand is showing signs of a slowdown. “Buyers are not placing as many orders as they did in the past few weeks. This must be due to their slowing end product orders.” He acknowledged that the rainy season traditionally weighs down on pipe demand in Thailand. A distributor in Thailand planning to offer at the same level with the domestic producer also confirmed that the trading activities have been thin recently in the local market. He complained, “We could not sell much last month. Now, we would like to see how the market will evolve in the short term.” However, he added, “We are open to negotiation for firm bids.” A roller manufacturer also showed reluctance to buy for now given his sufficient stocks. A Philippine producer, meanwhile, has decided to approach the local market with rollovers from April, considering the stiff resistance building on the buyers’ side against higher prices. “We think this will prevent any additional increases from passing in the coming weeks," a company source told ChemOrbis. In the Malaysian market, a source from a domestic producer said, “Local offers are stable for now, but buyers are showing growing resistance.” A compounder reported receiving a MYR50/ton ($16/ton) higher PVC k67 offer from one of the domestic producers on a weekly basis while he complained that the import offers of the nearby Indonesian and Thai producers are at lower levels. A pipe manufacturer also said, “Supply is sufficient while demand is patchy.” He feels further increases are not likely in the PVC market.
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