Acetylene based PVC offers reemerge in India
Chinese acetylene based PVC producers had been struggling to compete with ethylene based materials in India since mid-August when ethylene based prices started to follow a downward trend due to lower ethylene costs as well as weak demand stemming from the monsoon season. This softening trend came to an end in early October when regional producers issued slight increases on their new PVC prices to India in line with improved demand as well as several plant shutdowns across the regional markets in the September-November period. Spot ethylene prices on a CFR Northeast Asia basis, meanwhile, surged around $115/ton month over month due to expectations of tight supply given the upcoming cracker shutdowns.
A PVC compounder in India stated, “Offer levels for acetylene based PVC are currently near to those given for ethylene based cargoes. However, we believe that they may become more competitive in the upcoming period if a major Taiwanese producer announces their November prices with further increases to India. Meanwhile, the upcoming Diwali holidays may limit market activities a bit in November.”
A second end product manufacturer commented, “Overall demand has improved in India following the end of the monsoon season. We feel that PVC prices will witness additional increases in the near term due to better demand and several maintenance shutdowns across the region. We did not find the current price levels for Chinese acetylene based PVC to be competitive when compared to ethylene based materials. However, their reemergence shows that more Chinese sellers may attempt to enter the Indian market with more attractive prices in the coming term.”
Meanwhile, in China’s PVC markets, most players are currently away from their desks for the National Day holidays. According to some, more Chinese sellers may seek export opportunities in the near term as PVC demand in their own domestic market may fail to improve until the end of this year due to the persistently weakening economy which significantly hampers the country’s manufacturing and real estate activities.
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