Thread Content
Plastics: Multiple factors driving the continuous rise in the PVC market March 18, 2016 China Chemical Products Network I. Market overview for this week The domestic PVC market has maintained a strong upward trend this week. The main reasons for this are, on the one hand, low inventory levels among upstream PVC manufacturers, which has led them to raise the ex-factory prices of PVC; as a result, traders have also increased their quotes in line with these higher ex-factory prices. It has become difficult to find products at low prices in the market. At the same time, demand from downstream industries is gradually increasing, with companies actively placing orders. On the other hand, the commodities market continued to rise, driving a bullish sentiment in the market. As of the close of trading this weekend, the mainstream price for SG-5 produced by the calcium carbide method in East China was 5450–5550 yuan per ton, an increase of 150 yuan per ton ； The mainstream price in South China is 5,500–5,630 yuan per ton, up by 200 yuan per ton ； The mainstream price in North China is 5,300–5,400 yuan per ton, up by 200 yuan per ton ； The mainstream price for the Ethylene Process Type 1000 in East China and South China is 5,720–5,760 yuan per ton. Quotations for the main domestic PVC market, unit: yuan/ton. Product, Model, East China, Price change, South China, Price change, North China, Price change: Calcium carbide-based material, SG-5, 5450-5550, +180; 5500-5630, +200; 5300-5400, +200. Ethylene-based material, 1000, 5720-5760, +50; 5750-5800, +100; 5500-5600, +100. II. Manufacturer updates: This week, most PVC manufacturers are operating normally with limited inventory; however, there is some reluctance to sell at high prices. Most companies have a positive sales attitude, and the sales pace remains stable for now; it is possible that prices will rise again later on. The mainstream price for type 5 ordinary calcium carbide in the areas surrounding Inner Mongolia is 5,100–5,200 yuan per ton at the factory; discounts are available upon completion of the transaction ； The mainstream acceptance price in Shandong region is 5,300–5,380 yuan per ton at the factory exit ； The mainstream ex-factory price in Hebei region is 5,150–5,350 yuan per ton on credit ； In the Shanxi region, the standard ex-plant price is 5,150–5,200 yuan per ton, payable upon acceptance. The prevailing delivery price for ethylene-based enterprises in the East China region is 5,700–5,800 yuan per ton. III. Upstream raw materials: This week, the price of VCM in Asia increased by $10 per ton; the price CFR China rose to $610–611 per ton, while the price CFR Southeast Asia rose to $625–627 per ton. The price increase is driven, on the one hand, by a sharp rise in raw material costs; on the other hand, the price of PVC at the downstream level has also risen significantly. Additionally, maintenance plans undertaken by major companies also contribute to this increase. Since last Friday, the receiving prices of calcium carbide in regions such as Shandong, Hebei, Henan, Shanxi, Tianjin, and the Northeast have dropped by 30–50 yuan per ton. The price reduction is mainly due to the large volume of calcium carbide arriving at PVC manufacturers recently, and thus prices are lowered to control the inflow of this material. Some PVC manufacturers have also chosen to wait and see for now, hesitating to adjust their purchase prices. In PVC enterprises, the arrival of calcium carbide is uneven; deliveries are relatively good in North China, but the problem of overloaded trucks persists ； There are also cases where the quantity delivered is just enough, with a small amount left to be unloaded. The shipment conditions for calcium carbide manufacturers vary; in places such as Wuhai and Ningxia, sales of inventory to external markets have declined recently, while manufacturers are able to ship their products smoothly, and the phenomenon of selling at lower prices has disappeared. Currently, the supply of calcium carbide is uneven, with a continuous struggle between supply and demand. Coupled with the ongoing rise in PVC prices, the sentiment in the calcium carbide market is mixed, with an overall atmosphere of caution. IV. Statistics on maintenance activities of domestic enterprises Unit: 10,000 tons Region, manufacturing enterprises, production capacity, and shutdown status: Southwest, Leshan Yongxiang – 12 tons; shutdown began on February 3, resumption of operations in mid-April; shutdown duration of around 50 days. East China: Tianjin Botian – Production will be halted starting March 5th, with relocation procedures beginning. Northwest China: Haimingyan – The plant will undergo routine maintenance on March 10th, with the maintenance work continuing until the end of the month. Southwest China: Yibin Tianyuan – Maintenance is planned for late March, lasting around 10 days. Southwest China: Sichuan Jinlu – The PVC plant is scheduled for maintenance in April. Northwest China: Inner Mongolia Yili – The company plans to carry out maintenance in April. North China: Tianjin Chemical – Production will stop on March 11th. V. Market outlook: Today, the domestic PVC market is operating at high levels; the prices of bulk commodities continue to rise. PVC sales in various markets are satisfactory. Prices for calcium carbide-based raw materials continue to drop, while prices for ethylene-based raw materials have seen a slight increase. Manufacturers and traders remain optimistic, with limited discounts offered on products sold. Currently, PVC manufacturers have low inventory levels, so prices are unlikely to fall in the short term; there is still a possibility that speculation will drive up PVC prices next week.