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India’s PVC market moves closer to par with SEA

by ChemOrbis Editorial Team -
  • 18/06/2015 (10:17)
Players in Asia report that India’s PVC market is moving closer to par with Southeast Asia following several consecutive months in which India carried a comfortable premium over SEA due to relatively healthy demand and local supply tightness. According to data from ChemOrbis Price Index, average import prices on a CFR India basis have been trading with a comfortable premium over CFR SEA prices since the middle of January. The premium rose to as high as $90/ton in early March and stood at $50-70/ton as late as the second half of May. Over the past three weeks, however, the premium has noticeably lessened and PVC prices to India are currently trading close to par with prices to SEA.

A pipe manufacturer operating in India stated, “Demand has seen a significant drop off ahead of the monsoon season. A domestic producer implemented a decrease of INR4000/ton ($63/ton) last week and we expect to hear lower July announcements in the import market as well.” A trader based in India commented, “Inventory levels are considered high in the local market while most converters are purchasing in only limited amounts these days. We expect to see lower import offers for July next month and we believe that domestic producers may agree to further reductions on their prices if the drop in July import prices is sufficiently large.”

While prices were retreating in India, the Southeast Asian market held relatively stable, although some prices at the upper ends of the range faded from the market. A trader stated, “We managed to sell a total of around 3,000 tons to Southeast Asia this week, which we take to be an indication that demand is not bad. We expect to receive new July prices from our Taiwanese supplier next week. We believe that the supplier will rollover their prices in order to defend their margins.”
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