Lower PVC prices for November in India follow regional trends

31-Oct-14

Players report that major overseas producers have begun to announce lower November prices to the Indian market this week following similar declines implemented in other regional markets, with lackluster demand and softer upstream costs being cited among the main reasons for the downward adjustment in prices, as per ChemOrbis. Following the most recent price reductions, import PVC prices on a CIF India basis currently stand at their lowest levels since November of last year, according to data from ChemOrbis Price Index. At the start of the week, several players reported receiving initial November prices from a major Taiwanese producer with decreases of around US$30/ton from the producer’s most recent October deal level. This decrease mostly matches the cumulative price cut of US$40/ton the same producer implemented on their offers to the nearby Chinese and Southeast Asian markets. “We do not think that our supplier will be able to sell at this price level as upstream costs have softened and demand is not supportive. We plan to wait a while longer before making our next move,” a trader commented. Another trader who reported receiving new November prices for both Thai and Taiwanese materials added, “We have not decided as to whether or not to purchase as demand remains limited owing to the fact that buyers are just returning from last week’s holidays.” A PVC compounder who received November prices from two different Taiwanese suppliers stated, “We will need to purchase some materials soon in order to maintain our normal production. However, as we think that prices still have some room to move down, we are only planning to buy around 25-35% of normal monthly quantities for now.” A trader who reported receiving offers for Taiwanese, Japanese and South Korean PVC at similar levels also voiced their intentions of waiting to obtain further discounts from their suppliers before purchasing, commenting that local supplies are comfortable in the market. According to ChemOrbis, in the local market, players reported that a domestic producer has reduced their prices by INR3000/ton (US$49/ton) from the pre-holiday period. “The producer had been offering their customers price protection at the start of the week, but they have since lowered their prices and withdrawn their price protection,” a distributor reported.