As stated to SSESSMENTS.COM, a Thai PVC producer has officially announced June delivery offers to the domestic market this week. Along with market expectation, the Thai producer initiated a price increase of THB1,500/ton ($47/ton) for ethylene-based PVC cargoes as compared to the offer level available for May delivery. Current offers are available in the market between THB25,500-26,000/ton ($807-822/ton), depending on the volume of purchases. All offers are on cash, FD Thailand basis and excluding 7% VAT.
The producer revealed to SSESSMENTS.COM that striking domestic demand and weakening Baht were the major ground behind the price adjustment. At the end of May, most Asian currencies dipped against the US Dollar on simmering US-China tensions due to a worsening rift between the world's two largest economic powers over Hong Kong's new security laws fueled risk aversion, coupled with subdued trading activity as most regions closed for holidays. On May 25, the Thai Baht edged lower against a firmer greenback, dropped 0.3% to around 31.960 per US Dollar. Meanwhile, after the Thai government has begun lifting its lockdown restrictions in a phase-wise manner from early May, domestic demand has shown signs of recovery, backed by rising demand for end-products. Currently, sales for PVC pipe is considered healthy.
Speaking of the overall response, most buyers gave positive feedback toward the producer’s current offer level as most believe prices will continue to move higher in line with the international market trend. “So far, customers are willing to accept the current offer level,” the producer stated to SSESSMENTS.COM.
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