As SSESSMENTS.COM noted, converters and traders in the Asia market showed contrasting responses towards Japanese PVC offers. One of the Japanese PVC producers offered cargoes at $760/ton on CIF India Main Port Basis, while $680/ton applied to CIF Southeast Asia and CFR China. The offers to China and Southeast Asia markets recorded an increase of $30/ton and $40/ton respectively from May shipment offers. Meanwhile, no price comparison for offers to India as most foreign producers, including the Japanese producer, skipped offering to the country last month due to lockdown. All offers were on LC at sight.
The producer reported that the above offer was well received in the destination market with no difficulties in concluding deals. Pay attention to the destination market, SSESSMENTS.COM noted that India market itself became the main target of PVC producers after being skipped last month due to the extended Coronavirus lockdown. An India-based trader even reported that another Japan producer is willing to lower the offers by $10/ton from $750/ton-level for customers who previously took some volume from the producer at higher prices. While there is good demand from traders, converters are still cautious in making procurements taking into account no significant improvement in sales for their end-products and India will be in the monsoon season in the next 2-3 months.
In Vietnam, a trader managed to reach deals with producers in the range of $680-690/ton, although the converter expressed buy ideas at $660/ton. Even though the offer from Japan shows the accuracy of prediction that import ethylene-based PVC prices have a big room to increase, Vietnamese market players predict that it might not last for a long time due to the lack of supporting factors. At the moment, PVC demand remains slow as most converters have replenished their stocks last week. Besides, the rainy season is around the corner. As the weak demand due to the rainy season is on the edge, converters prefer to keep the lean inventory level. As such, some Vietnamese players are afraid that the upward price adjustment will hinder buyers from procuring materials. Since global PVC demand has not back to normal yet, prices might go down after increasing, as stated to SSESSMENTS.COM.
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