Tight local supplies push Italian PVC buyers to import market, PVC plants, PVC prices, suppliers

Tight local supplies push Italian PVC buyers to import market

29-Oct-10

The euro has maintained its strength against the US dollar over the month of October, with the exchange rate parity hovering above 1.38 since the first half of the month. As per Chemorbis, the rising euro/USD parity has attracted more import PVC cargoes to Europe this month as the USD based offers are lower in value in euro terms, contributing to the competitive power of these non-European PVC cargoes. Consequently, import PVC offers especially from North America showed up significantly below the local market level this month. As the ongoing strength of the exchange rate keeps the door open to imports in Italy, PVC buyers have been meeting their needs from non-European origins. Tightness of prompt supplies due to several plant shutdowns across the region was another factor pushing Italian buyers to import supply sources in order to meet their needs. As a result of the ongoing strikes in France, several producers have been facing delivery disruptions for the last couple of weeks, adding to the effects of earlier shutdowns. Before the strikes, a couple of regional producers had declared force majeure from their PVC plants. As US, Mexican and Colombian import offers on DDP Italy basis, including all applicable costs, have provided a competitive edge, standing almost €100/ton below the low end of the local European price ranges, there has been interest for these cargoes. After a seller reported selling out October allocations for US and Mexican origins in the previous week, another supplier has sold out the first part of November shipment import cargoes for US origin. “Thanks to the favorable euro/USD exchange rate parity, along with tight supplies across Europe, we are receiving lots of calls from our local customers,” he noted.