Weekly PVC Overview - Week 34 – 2018

September shipment offers emerged at stable to softer levels, demand remains soft

In Asia, a major Taiwanese producer announced September shipment offers at $10/ton higher to India while maintaining prices unchanged to China and Southeast Asia market. Demand across the region remains soft due to the Asia Petrochemical Industry Conference (APIC) and the Eid al-Adha holiday in Muslim markets. 

In India, the latest offers are much in line with market expectation and yet, sales have not been very smooth despite the volume discount that brought deals to the same level as it was in August - $990/ton CIF India, LC AS term. “The monsoon season has not eased and we think demand would only come back by second half of September,” a trader said. Sources added that major Taiwanese producer took slightly longer than usual to sell out the allocation to India. 

Meanwhile, domestic China market opened on a rather positive note, which encouraged suppliers to introduce CNY250-300/ton ($36-44/ton) hike on carbide based cargoes, sending price list to CNY7500-7700/ton ($938-963/ton without VAT) EXW China, cash equivalent. However, the momentum just plunged sharply toward the end of the week, forcing a reduction of CNY450/ton ($56/ton) from the beginning of the week. By the time this report is published, carbide-based PVC in domestic China has reached CNY7050-7250/ton. 

“We couldn’t catch a breath. Market just deteriorates too quickly following the reduction on Dalian Commodity Exchange. We fear that carbide-based PVC might slip below the CNY7000/ton ($876/ton without VAT) threshold,” a trade informed. However, a number of sellers are showing limited interest in the export market due to limited availability.

The Southeast Asia region remains a little calm due to heavy monsoon season addition to the Eid al-Adha holiday in Malaysia and Indonesia. A Malaysian pipe maker received South Korean PVC offers at $930-935/ton CIF added, “Malaysia is undergoing a major transformation. Demand for pipe is not very strong, as many projects are put on hold. After budget 2019 announcement this November, demand might be better.” 

Vietnamese buyers are still seeing USA cargoes available at below $900/ton threshold, which pressure other origins that priced at the high-$900/ton.