Local PVC offers move higher, imports expected to follow in SE Asia

06-Dec-10
In Southeast Asia, regional sellers have announced December offers to local markets with increases from November done deal levels, citing higher upstream costs along with limited, as per Chemorbis. Import prices are expected to follow domestic prices higher within the next few weeks. Although overseas sellers reported disappointing sales in Southeast Asia for the past month, they predicted that prices would nevertheless rise for the January round of business based on expectations of higher January import offers to the Chinese market. Import PVC prices in China have posted six consecutive months of increases after December business for mainstream Asian origins was settled US$30-40/ton higher than November. Players in the Chinese market are currently anticipating January import offers with increases of around US$20/ton from December done deal levels, with sellers feeling confident about their prospects for January on account of smooth sales for December despite the season, as higher prices in China’s domestic market have encouraged buyers to source more from the import market. Although Southeast Asian producers complained that they had to agree to decreases of around US$30/ton from their initial offers before concluding their December business to the region, import prices are still likely to move higher for January given rising VCM feedstock costs in Asia and the prospect of higher January offers to the Chinese market. In Southeast Asia’s local markets, most producers have already announced December offers to their domestic markets with increases of US$17-75/ton when compared with November done deal levels. While the producers nominating relatively larger December increase targets have admitted that they may need to concede to some discounts before concluding deals, most producers are feeling confident of their ability to achieve sales at or close to their initial offer levels. Demand is expected to be relatively slow in most parts of the region during the final month of the year, although stronger import demand in China means that producers will have the option of diverting part of their allocation to the export market and thereby prevent stocks from building up inside the region. In Indonesia, a producer reported that they are seeing better than expected demand for this time of year, which gives them additional confidence in their ability to achieve deals at or close to their initial offer levels for the month.
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Complete Herbert Olbrich cushion vinyl flooring line