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After nearly two consecutive months of continuous price increment, local PVC market in China seems not loosing any of its steam up to this week as suppliers see no obstructions in implementing further hike. Indeed, domestic offers for both ethylene and carbide based PVC are up CNY100-200/ton ($15-30/ton) compared to last week and buying interest remain resilient.

Higher production costs stemming from tightened environmental control rules and regulations left carbide based PVC makers no choice but to lift prices to defend their profit margins. A maker from Inner Mongolia said, “Not only feedstocks are higher, transportation costs also swelled. This week, we increased our offers by CNY100-200/ton ($15-30/ton) and we managed to close a good number of deals to local buyers.” The producer also lifted export offers by $10/ton to reach $830/ton FOB China, LC AS term. The source added, “Our Southeast Asian customers are not very responsive to the new price levels, yet we would prefer to hold firm stance on our cargoes on the back of lacking sales pressure.”            

An ethylene based PVC producer in Ningbo also announced new prices with CNY150/ton ($22/ton) hike earlier this week. The producer said, “Local supply is very tight due to lower production rate at major plants recently. The high demand season is just started and we feel really optimistic about the near term outlook.”

Another ethylene-based producer in Tianjin reported, “We have high number of backlog need to clear, hence we have to suspend all offerings this week. Market is on an up-trend and we believed that international suppliers would increase their offers in the coming week. We think even USA suppliers would not be able to offer lower prices given higher shipping costs.”

Most players are generally looking at firmer trend in the near term with some expect the sustainability up to November. Domestic offers for PVC in China currently ranging from CNY6100-6700/ton ($780-857/ton without VAT) and export offers stand at at $830-850/ton, FOB China, LC AS term.