Traders in Egypt, Turkey: US PVC could firm up

09-Dec-15

Traders in Egypt and Turkey have been voicing expectations of firmer export PVC prices out of the US for new shipments since last week, as reported on www.ChemOrbis.com. The upcoming turnarounds planned in the US are expected to diminish allocations of US producers for export markets, although this news has not been confirmed by the producers’ side yet. A global trader based in Turkey said, “We have sold out our January quotas and we are now facing reduced output from our supplier. The lower levels heard in the market may disappear soon.” A second trader in Istanbul also reported that they are trying to refrain from selling below a certain threshold given the recent indications from their US suppliers, who are asking for price increases in their domestic market. Players in Egypt already reported some firming in import offers from the US this week following offers emerging at least US$40/ton below Turkey last week. A global trader’s Cairo office reported lifting its offers up this week, saying “Supplies are restricted and holidays are expected to affect shipments in the upcoming weeks.” However, a company source also admitted being open to firm bids following the price hike. A second trader in Egypt also affirmed the rebound in prices this week, saying last week’s competitive levels are vanishing, although he acknowledged that demand remains subdued. “Buyers are still placing lower bids but they are not approved by our suppliers,” commented another trader. Buyers both in Turkey and Egypt, on the other hand, do not find any reversal attempt realistic these days. An Egyptian pipe maker said, “We do not think that these attempts to firm up PVC will work when demand is this slow at the year-end.” Some profile and pipe makers in Turkey also do not see traders taking a firm stance, according to ChemOrbis. “The market is at multi-year lows. There may not be further decreases; however, any firming is not likely either, particularly when demand is absent and crude oil is at a 7-year-low,” commented a buyer. The recent plunge in crude oil appears to have affected the sentiment among some sellers in Turkey too with a few of them raising concerns over the medium term expectations.