PVC sentiment is beginning to shift in Asia owing to slumping upstream markets and the decision of a major regional producer to step back on their prices for March according to the pricing service of ChemOrbis. Trading activity is said to be limited as many buyers are sticking to the sidelines while waiting for a clearer idea of the likely market trend.
Traders reported that a major Taiwanese producer stepped back on their March increases this week after announcing larger than expected price hikes of $50-70/ton in the middle of April. Although the producer had already reportedly concluded deals at their new offer levels, sources reported that the producer planned to refund the difference to buyers who had purchased before their price adjustment. A trader based in Shanghai stated, “We revised our March increases for Taiwanese PVC downwards from $50/ton to $30/ton and we believe that other sellers will also moderate their March increase requests in the days ahead.” A trader based in Taiwan also reported moderating their March hike requests downward by $20/ton, adding, “Demand is not very encouraging now and most buyers have retreated to the sidelines in hopes of receiving further discounts. We believe that prices will remain steady over the short term.”
A buyer in India commented, “We have sourced only around 30% of our normal allocations for this month as we expect to see some price relief next month. We have heard that a large amount of Chinese material will enter the Indian market soon and we anticipate seeing looser supplies accordingly. A trader based in India added, “The decision made by a major regional producer to step back on their offers has only encouraged more buyers to retreat to the sidelines. Buying interest is very limited now as most buyers are waiting for more attractive prices which they think will emerge in April.”
A Chinese producer offering acetylene based PVC to Southeast Asia and India commented, “We kept our prices steady but are willing to negotiate with buyers placing firm bids. We think prices will remain stable over the short term but are not so confident about the medium term outlook. We are closely following the differential between ethylene and acetylene based PVC prices as demand for our products will dry up if the premium for ethylene based PVC over acetylene based PVC falls to $20/ton or less.” Another Chinese producer offering acetylene based PVC prices to India reported, “We are thinking of reducing our prices by $30/ton this week to match the recent decreases seen on ethylene based PVC prices. Demand is not very strong these days.”
A Malaysian converter manufacturing PVC pipes and conduits reported receiving steady import prices for Indonesian origins this week as per ChemOrbis. “We do not find the current prices to be attractive and we are planning to wait to receive more competitive prices before purchasing again as our stock levels are comfortable. We are seeing normal demand for end products now.” A Thai converter manufacturing PVC sheets and calendaring added, “We are planning to meet our needs from the local market for March as our domestic supplier did not increase their prices for this month and we believe that import prices will move lower for April.”