Chinese carbide PVC makers lifted offers, demand linger mediocre

It is reported that major carbide based PVC makers in China has lifted offers to both domestic and export markets this week following a hike in feedstock and surging futures trading. A CNY100/ton ($15/ton) increased to domestic buyers is observed with mediocre number of deals while $10/ton hike in export offers shied buyers away.

Strict environmental control forced about 15 carbide furnaces in the province of Ningxia to shutdown, causing an approximate production loss of 2000/ton per day of carbide feedstock, which account for 3 per cent of China’s total carbide output. “Costs are moving higher and we are left with no choice but to transfer to PVC prices,” a carbide based PVC producer said.

Demand in domestic ground is mediocre. With heavy support from continuous firming futures market, both traders and converters encouraged to procure only small quantity. Players are not expecting to see any drastic surge in demand this winter, considering the ban in major construction work in Beijing from 15 November to March 2018. “This explained to why the buying sentiment is so lackluster here in spite of more than CNY300/ton ($45/ton) accumulated increased in futures prices compared to last Friday. Spot ethylene based PVC has not changed,” a trader added.

Overseas buyers are not responding so well to the hike in export offers, producers informed. “However, we hope that major Taiwanese maker would keep January offers on the stable to firmer trend, which could in turn support our offers,” another maker said.

Local PVC prices in China currently stand at CNY6200 – 6300/ton ($803-816/ton without VAT) for carbide based and at CNY6800/ton ($881/ton without VAT) for ethylene based PVC.