SE Asia’s PVC market setting the lead for China

11-Jan-13
Although PVC prices in China and Southeast Asia continue to mirror each other quite closely, for the past two months price changes have occurred in Southeast Asia first and then been reflected in China rather than vice-versa, as per ChemOrbis. There are signs that this trend may continue next month as players in India and Southeast Asia are already reporting receiving higher import prices while sellers in China are giving higher sell ideas but have not announced new prices yet. PVC prices to both China and Southeast Asia slid lower almost simultaneously from the middle of September 2012 until early November. As the trend began to shift, prices in Southeast Asia took the lead, stabilizing in early November three weeks before import prices to China bottomed out and began to stabilize. Prices in both regions jumped at the start of December, but Southeast Asia once again proved the trend setter as prices firmed up gradually throughout the month in that region, while Chinese prices stabilized at the early December plateau and only began to catch up with Southeast Asia during the last week of the calendar year. A similar trend appears to be place at the start of 2013, as import prices to Southeast Asia and India are posting increases while sellers in China have expressed higher sell ideas but have not announced new prices yet. A trader based in Shanghai gave their sell ideas for American PVC with US$45-55/ton increases this week, commenting, “Trading activity is limited these days and we are watching the market to gauge other sellers’ price intentions before officially announcing our new prices.” While players in China are anticipating higher prices, players in India and Southeast Asia report that import prices are already moving higher. A trader based in India told ChemOrbis, “We purchased some Taiwanese k67 with increases this week. We think that prices will remain firm at their current levels but we are skeptical as to whether or not prices will have any additional room to increase as we feel that demand will remain sluggish until mid-February.” A converter based in Malaysia commented, “We are seeing higher prices from the import market this week. Buyers have been more active out of fears of additional increases, but end product demand has not really improved. We plan to wait for a while longer before making any fresh purchases.”
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