Lack of support: The domestic PVC market is experiencing a gradual decline

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Lack of support drives slow decline in domestic PVC market. May 27, 2016. China Chemical Products Network. I. Market overview for this week: This week, the domestic PVC market showed weak performance, with prices declining steadily； At the beginning of the week, the effects of the Northwest Enterprises Joint Meeting continued to have an impact, with manufacturers and market traders continuing to raise their prices ； By mid-week, although there was still some momentum driving prices up in various markets, weak demand from end-users led to increased resistance among downstream manufacturers to price increases. Orders were coming in slowly, and traders in the market began to lower their quotes in an effort to secure sales ； In the later period, support from the commodities market weakened, and PVC prices continued to fall. However, upstream manufacturers, under cost pressures, maintained firm pricing, which provided support for PVC prices at their bottom level and limited the extent of further declines. Next week, close attention will still be needed to the trends in raw materials and futures markets. As of the close of trading this weekend, the mainstream price for SG-5 produced by the calcium carbide method in East China was 5250–5310 yuan per ton, a decrease of 30 yuan per ton ； The mainstream price in South China is 5,210–5,330 yuan per ton, a decrease of 20 yuan per ton ； The mainstream price in North China is 5,170–5,270 yuan per ton, a decrease of 10 yuan per ton ； The mainstream price for the Ethylene Method Type 1000 in East China and South China is 5,600–5,650 yuan per ton. Domestic mainstream PVC market price list: Product, Model, East China, Price change, South China, Price change, North China, Price change. Calcium carbide-based material: SG-5, 5250-5310, -20; 5210-5330, -20; 5170-5270, 0. Ethylene-based material: 1000, 5600-5650, -90; 5600-5650, -90; 5350-5450, -90. II. Manufacturer updates: This week, most PVC manufacturers were operating at normal capacity levels; factory prices remained stable on the surface but actually declined, with sales performance being average. 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 settlement ； 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 enterprises using the ethylene method in East China is 5,700–5,800 yuan per ton. III. Upstream raw materials: The Asian VCM market remained sluggish this week, with prices falling; CFR Far East dropped by $15 per ton to $630–$631 per ton, while CFR Southeast Asia fell by $10 per ton to $690–$692 per ton. The price decline is mainly due to weak demand in the downstream markets, while supply in the Southeast Asian market is relatively low, so prices there remain significantly higher than those in the Far East. This week, the price of calcium carbide remained stagnant, with market prices struggling to decide whether to rise or fall. Looking at next week, on the one hand, the production of calcium carbide will increase only slightly, and the overall supply will still be somewhat insufficient ； On the one hand, there are hardly any maintenance activities scheduled for PVC next week, so the demand for calcium carbide will remain high. Under these circumstances, there will be no significant changes in the supply and demand of calcium carbide; downstream purchases will remain strong, and calcium carbide manufacturers will continue to sell their products without difficulties. Meanwhile, since PVC is expected to remain in a weak position, prices of calcium carbide are likely to stay stable, with no clear trends of increase or decrease. IV. Statistics on Maintenance Activities of Domestic Enterprises
Unit: 10,000 tons

Region, Manufacturing Enterprise, Process, Shutdown Status
Southwest: Yunnan Salt Chemicals – Calcium carbide process. Shutdown for maintenance in late December 2015; restart time uncertain.
Northwest: Salt Lake Haina – Calcium carbide process. Shutdown for maintenance on March 19; restart time uncertain.
Northwest: Inner Mongolia Ely – Calcium carbide process. Shutdown for maintenance on May 16; maintenance is planned to last 7–10 days.
Northwest: Huojiagou – Calcium carbide process. Shutdown for maintenance starting from May 9; restart scheduled for May 16.
Northeast: Heilongjiang Haohua – Calcium carbide process. Maintenance began on May 7; production is set to resume on May 19.
Northwest: Ordos Chlor-Alkali – Calcium carbide process. Maintenance is planned for July.
Northwest: Yidong Dongxing Chemical – Calcium carbide process. Maintenance for both PVC powder and paste is planned for mid-June.
North China: Tangshan Sanyou – Calcium carbide process. 400,000 tons of PVC powder and 40,000 tons of paste are likely to undergo maintenance in June.
Northwest: Shaanxi Beiyuan – Calcium carbide process. Partial-load maintenance is planned to start on May 22 and last 2–3 days.
Northwest: Yinglite – Calcium carbide process. Maintenance for 50,000 tons of PVC paste is planned to start on June 10 and last one week.
Northwest: Xinjiang Tianye – Calcium carbide process. Maintenance for 100,000 tons of PVC paste is initially planned to start at the beginning of June and last one week.
Northeast: Shenyang Chemical – Calcium carbide process. Maintenance for 150,000 tons of PVC paste is planned to start on June 10 and last around 20 days.
East China: Anhui Chlor-Alkali – Calcium carbide process. Maintenance is planned for PVC paste, but the exact date has not been determined.
North China: Hebei Shenghua – Calcium carbide process. Maintenance was originally planned for May 22, but it has been postponed; the specific date remains unknown.

V. Market Outlook
Today, the domestic PVC market shows a slight decline, with traders reporting falling prices. Although inventory levels among downstream users have decreased slightly, weak demand from these users means that companies are not very active in taking orders. As a result, there is little support for price increases. It is expected that the domestic PVC market will continue to remain in a state of cautious adjustment in the short term.