Market sources reported to SSESSMENTS.COM that the offers for import PVC to China reached the lowest level since 2009 and will put pressure on local producers. The ongoing global lockdown led to weakening demand, as such, traders and producers are aggressively selling the cargoes to China market which caused a significant downward adjustment in prices. Market talks have it that import ethylene-based PVC of US origin to China concluded this week at $580/ton on LC at sight, CIF China Main Ports basis.
Previously SSESSMENTS.COM reported that done deals for cargoes from the leading Indian PVC producer to China were concluded at $590/ton on CFR basis. On April 8, a global trading house informed that the leading Indian PVC producer sold approximately 10,000 tons to China and the prices are below $600/ton-level on CIF basis.
As the import prices move lower week over week and local PVC inventory continues to pile up, PVC producers in China opted to shut their plants to ease the supply glut. As of April 13, the coastal inventory recorded at 484,700 tons which has increased by 1,100 tons from last week’s level. Further added to SSESSMENTS.COM, the movement in South China and East China captured in the opposite direction. In South China, the inventory decreased by 4,000 tons while in East China the inventory increased by 5,100 tons. However, sources opined that local producers will face inventory pressure as more and more cargoes are expected to arrive in China market. Market talks have it that there will be around 70,000-100,000 tons of imported PVC cargoes from Taiwan, South Korea, and Southeast Asia to arrive at the end of April or early May.
In the local market, traders have started to offer ethylene-based PVC from Thailand and leading Indian PVC producer at CNY5,500/ton ($778/ton) and CNY5,300/ton ($750/ton) respectively on cash, EXW China basis, and including 13% VAT. A trader stated to SSESSMENTS.COM that the current offer level is deemed attractive in China market, as the offers are at par or even lower than the offers for local acetylene-based PVC. As such, the trader believes the pressure is huge on local producers, in addition to the additional quantity of import PVC cargoes to be moved to the China market.
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