Mediterranean PVC market fails to match bouyancy of Asia

The Asian PVC market has been rising for the past four months, inevitably pulling the Mediterranean markets along with it as import prices to the region have risen in line with the bullishness in Asia, as per Chemorbis. However, sluggishness in local markets of Turkey and Egypt has been noticeable since the start of the year, with only import prices managing to push the markets higher in January. However, slow demand is now keeping a drag on prices in the distribution markets in February. The Italian PVC market was finally affected by the rising trend in January but local prices are currently below new import offers, a complete reversal of the conditions seen near the end of last year. A producer in the Mediterranean region has succumbed to sluggish local market conditions and decided to cut prices even as the Asian market is forecast to see higher offers for March once the Chinese buyers return from their New Year holiday next week. Egypt’s domestic producer, EPC, cut its PVC prices to the local market by US$27/ton and its export prices by US$25/ton at the start of this week. The decrease decision was based on the slow local demand and lower offers in the distribution market. Despite the fact that US offers have been firming up on the low end of the import range during February, the local market has failed to keep up. Before the domestic producer’s price cut, offers for locally held materials lacked any premium over imports and now after the price decrease news, offers from Egyptian distributors are even reported under import prices. Similarly the local market in Turkey sputtered out in February. The low end of the distribution market saw a $10/ton rise in the first week of the month, but since then has not been able to rise higher and the high end has since lost $10/ton. Comments are similar to those in Egypt that demand is extremely slow and the market is stagnant and this is despite the fact that the local market offers the best option to buyers in terms of prices. One trader commented that they had expected the domestic producer to make a price increase as import prices have been rising, but there has not yet been any price change news coming from the producer since the start of the month. The slow demand has caused the local supply to appear ample and buyers commented this past week that some distributors would like to cash in on their stocks and have been willing to give discounts. In the Italian market, some sellers are pleased with their sales although overall demand is considered to be weak. The reason for their contentment is that some producers have limited availability while imports are priced out of the market leading to better demand from European sources. Currently, import offers are up to €50-70/ton above the low end of the local price ranges. The sluggishness in the Mediterranean has meant that Asian PVC imports have been pretty much shut out of the market this month. Far East Asian PVC last knocked on Egypt’s door at the end of January but at prices well above American offers rendering them unworkable. In Turkey, the scene is similar with Far East Asian prices too high to be considered by buyers when there are other alternatives available. A single Southeast Asian source was reported offered this past week but after a price cut to the Turkish market. In Italy, mainly North and South American import offers are reported but no Asian offers. Asian PVC producers, meanwhile, have talked of price hike intentions for March business to China. Prices are expected to be announced next week after the Chinese New Year holiday. However, it appears they will have to rely mainly on regional demand for support.