The market continues to decline; there is no support for PVC prices

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The market continues to decline; there is no support for PVC prices. July 16, 2015, China Chemical Products Network. I. Market overview: Data on crude oil released by the U.S. Energy Information Administration on the 15th showed that last week the total commercial crude oil inventory in the United States was 461.4 million barrels, a decrease of 4.3 million barrels； Crude oil inventories in the Cushing area of Oklahoma, the main delivery site for U.S. crude oil futures, stood at 57.1 million barrels, up by 440,000 barrels. Last week, the average daily crude oil production in the United States was 9.562 million barrels, a decrease of 42,000 barrels, but it remained at a historical high. Transaction prices in various markets are declining, with the prices of some actual transactions continuing to fall. II. Upstream raw materials: The Asian ethylene market dropped by $10 per ton on July 15. CFR Northeast Asia closed at $1,204.5–$1,206.5 per ton, while CFR Southeast Asia dropped by $10 per ton, closing at $1,139.5–$1,141.5 per ton. The calcium carbide market remained stable today; the volume of calcium carbide arriving at PVC manufacturers continued to decline, with the amount awaiting unloading also dropping. III. Corporate Updates: Today, the pricing of PVC manufacturers using the calcium carbide process in China has seen a slight decline. These companies are having difficulty selling their products, so they are focusing on reducing their inventory levels. Type 5 ordinary calcium carbide material: the prevailing ex-factory price in the areas surrounding Inner Mongolia is 5,300–5,400 yuan per ton ； The mainstream acceptance price in Shandong region is 5,500–5,550 yuan per ton at the factory exit ； The mainstream ex-factory price in Hebei region is 5,400–5,450 yuan per ton on credit ； In the Shanxi region, the mainstream ex-factory price is 5,500–5,600 yuan per ton, payable upon acceptance. Some PVC manufacturers using the ethylene process have lowered their prices; Formosa Plastics in Ningbo has seen its price drop by 50, to 5,900–6,000. Taizhou Liancheng is currently stable at 6,000–6,050, with a price of 840 in US dollars; a price cut is planned. Formosa Plastics in Taiwan has set its price for July at $860 per ton CFR the main ports in China. Delivery available in the area around Hanhua Ningbo 5850-5950. Suzhou Huasu 5950-6050, foreign currency payment. IV. Market Trends: Domestic PVC market price table. Unit: yuan/ton. Product, Model, East China, Price change, South China, Price change, North China, Price change. Calcium carbide-based material, SG-5: 5390–5480, -40; 5450–5750, 0; 5410–5500, -10. Ethylene-based material: 1000, 5800–5900, -50; 5830–5950, -20; 5700–5800, 0. The prevailing price in the East China PVC market is 5390–5480. Changzhou Yihua 5390, Shengxiong 5430, Jilantai 5450. Shanghai Tianneng Type 5: 5420, Type 8: 5690. Hangzhou Zhongtai 5480, Junzheng 5430 for pick-up, Tianchen Type 5 5450-5500, Types 3 and 8 5720-5750. Ethylene material: 5800-5900. In the North China PVC market, Qilu S700 and Qilu S1000 from Qilu Chemical Industry City are priced at 5680–5700, with pick-up available on-site. Calcium carbide material 5400-5480 delivered. Delivered to the Linyi area from 5420-5480. Delivered to Hebei 5330-5380. Pickup available at warehouse 5350-5450 in Tianjin area; for various models in Tianjin’s Dagu and LG locations, pickup is available at 5700-5800. The mainstream PVC price in South China is 5450–5650 for Type 5; Beiyuan’s price is 5500, Zhongtai’s price is reported at 5550, Yihua’s price is 5500, Junzheng’s price is 5520, Yanhu’s price is 5560, Dongxing’s price is 5500, Tianhu’s price is 5550, Shengxiong’s price is 5470, E’erong’s price is 5530, and Tianneng/Tianchen’s price is 5650. Sanyuan San’s price is also 5650. Dagu 1000 is at 5830. V. Trading Situation: After more than four hours of intense debate, the Greek parliament finally approved on Thursday morning the reforms and austerity measures required to obtain aid funds from the eurozone. Currently, attention has shifted to the European Central Bank. The bank is considering whether to inject more aid funds into the Greek financial system. The ECB’s Governing Council will meet later on Thursday in Frankfurt. It is expected that a stabilization of the situation in Europe will have a positive impact on the global economy. Wide-range PVC has entered a volatile pattern; it closed lower again today, with weak trading volume as sellers show little interest at present. As of the close, the price for calcium carbide method in South China in July was 5650 ； The price in East China is 5510, while the price for the ethylene process is 5830. The fundamentals in the spot market continue to show a downward trend, with weak trading activity and poor sales momentum. It is expected that the price of Guangpu plastics will remain on a downward trend in the short term. VI. Future outlook: The PVC market is expected to continue its downward trend, with prices falling significantly in various regions. PVC manufacturers upstream are reducing their prices due to pressure to sell their products. As crude oil prices decline, those involved in the ethylene-based production process lack confidence in the future market, leading to a generally pessimistic outlook for the market ahead. The market is expected to continue its downward trend.