The PVC market remains stagnant with poor prospects

Thread Content

The PVC market remains stagnant with poor prospects. October 27, 2015, China Chemical Products Network. I. Market overview: International crude oil prices continue to fall, the calcium carbide market stays weak, and market activity remains sluggish. Cost pressures limit the room for PVC manufacturers to reduce their export prices. Downstream buyers place small orders as needed; prices at the lower end of the market remain stable, while prices at the higher end continue to drop. II. For upstream raw materials, the price of ethylene in Asia on a CFR basis in Northeast Asia increased by $45 per ton, settling at 1,004.5–1,006.5 dollars per ton, while the CFR price in Southeast Asia remained stable at 1,009.5–1,011.5 dollars per ton. The spot supply in the ethylene market remains tight, with sellers being reluctant to sell, which has driven up ethylene prices overall. Only the receiving prices for calcium carbide in certain areas of Shaanxi have decreased, while those elsewhere remain stable. The arrival of calcium carbide for PVC manufacturers remains uneven, with queues for unloading coexisting clearly with a basically normal flow of deliveries. Although there have been some shutdowns for maintenance in calcium carbide plants, the decline in production has been limited, and overall market supply remains ample. Currently, there is still a struggle between supply and demand in the market, with prices remaining largely stagnant. III. Enterprise updates: Today, there is still a slight decline among some calcium carbide-based PVC producers; in the Inner Mongolia region, an increasing number of shipments are made at prices below 4,800 yuan per ton. Type 5 ordinary calcium carbide material: the mainstream price at manufacturers in the surrounding areas of Inner Mongolia is 4,750–4,900 yuan per ton ； The mainstream acceptance price in Shandong region is 5,110–5,250 yuan per ton at the factory exit ； The mainstream ex-factory price in Hebei region is 4,950–5,100 yuan per ton on credit ； In the Shanxi region, the standard ex-plant price is 5,000–5,100 yuan per ton, payable upon acceptance. Domestic PVC produced via the ethylene method has stabilized after adjustments, with most regions showing stability. In North China, Qilu Petrochemical, Tianjin Dagu, and LG Dagu offer prices of 5400–5550 yuan/ton at the factory gate; in East China, the price is 5600–5750 yuan/ton upon delivery. Discounts are available for large orders. For Formosa Plastics in Taiwan, the price for November is 800 US dollars/ton CFR the main ports in China. IV. Market Trends: Domestic PVC market price table. Unit: yuan/ton. Product models: East China price changes, South China price changes, North China price changes. Calcium carbide-based material: SG-550 at 30,520–52,200; 4980 at 50,30–52,200; 4980 at 51,500. Ethylene-based material: 10,000; 55,30–56,30; 30–20; 55,000–56,000; 30–54,500–55,100. The prevailing price in the East China PVC market is 50,30–52,200. Changzhou Zhongtai 5130, Yanhu, Inner Mongolia Yihua, Dongfang Hope 5030-5050, Junzheng 5080. Shanghai Tianneng Type 5: 5200, Type 8: 5380. Hangzhou Zhongtai: 5180; Dongxing: 5100 (pick up in person). Yili, Junzheng, Yushui: 5080–5120. Tianchen Type 5: 5220–5250; Type 8: 5390–5450. Ethylene material: 5530–5600. In the North China PVC market, at Qilu Chemical City, the price for Qilu S700 type is 5450; 1000 units are available at 5430, with pickup available. Calcium carbide material 5130-5200 has been delivered. Delivered to the Linyi area from 5130-5200. Delivered to Hebei at 4950-5000. Pickup available at warehouse 4980-5050 in Tianjin area; for various models in Tianjin’s Dagu and LG locations, pickup is available at 5400-5550. The mainstream PVC types in South China are Type 5: 5030–5220; Sanyuan: 5010; Jilantai: 5030; Dongxing and Dongfang Hope: 5050; Shengxiong, Tianhu, Ordos, Neiyi, Beiyuan, and Yili: 5060–5090 (for pick-up in person); Junzheng: 5100; Zhongtai: 5220; Tianchen and Tianneng: 5220. Dagu 1000, 700, 800 are priced at 5500-5530, while the 1300 model is priced at 5700. V. Trading figures: The total profit of industrial enterprises above a certain size in September decreased by 0.1% on a year-on-year basis, with the decline rate being 8.7 percentage points lower than that in August. That month, the main business revenue of industrial enterprises declined by 0.5% on a year-on-year basis, marking the first decline in many years and indicating that the difficulties faced by these enterprises in their operations have intensified further. Today, the main PVC contract on the Plastics Exchange continued to show a weak trend; aside from a few contracts that saw a slight increase of 10, the overall trend remained downward. The pricing levels set by upstream PVC manufacturers dropped slightly, reducing the cost for markets to replenish their stockpiles. Additionally, traders remain pessimistic about future market conditions, resulting in low willingness to purchase, and thus trading volume was low during the session. By the close, the price for calcium carbide-based production in South China in October was 5140, down by 1 ； East China closed at 5,200, down 70; North China closed at 5,160, up 10. The ethylene method closed at 5,530, down 30. In November, the price for calcium carbide method in South China was 5160, up by 10. Fundamental market trading remained low, with no significant improvement observed in various regions. The short-term weak trend for PVC in the plastics exchange remains unchanged, and it is expected to continue in a downward, volatile pattern. VI. Future market outlook: Today’s market activity is weak; prices across various regions remain low. There is an ample supply of goods in the market, and downstream enterprises are operating at a low level, which results in limited actual trading and sales in the market. Shops mainly sell at reduced prices. The market lacks any significant positive factors to support it, so it is unlikely to see improvement in the coming period. It is expected that the weak and stagnant trend of PVC will not change in the short term.