A Thai PVC producer neglected Malaysian buyers’ request for additional volume as the company already sold out all allocation for July shipment. As reported by a Malaysian trader to SSESSMENTS.COM, the Thai PVC producer is currently no longer offering as they have sold out all allocation to the Malaysia market. Last week, the producer’s July shipment offers to the Malaysia market were stable on a weekly comparison, stood at $790-795/ton on CIF basis and at $815/ton on DAP basis, both are available on LC at sight. Deals were mostly concluded at the initial offer levels. The producer allocated most of their cargoes to the China market; taking into account the price is much more acceptable by buyers in China than in the Southeast Asia market, also the domestic supply in China is limited. Due to this, the Thai producer did not heed the request from Malaysian buyers for additional volume since last week.
Demand-wise, SSESSMENTS.COM was told that sales for PVC end-products that are related to the construction sector have started to pick up slowly. Meanwhile, based on Malaysia's pipe manufacturers association’s report, most pipe manufacturers in the country are keeping their production low at around 28% from the normal rate as most are still dealing with the old orders which are about to be due soon. The pipe manufacturers have no intention in making procurements for raw materials since their inventory is ample for at least until July productions. For other PVC end-products such as compound and calendering, the domestic demand has gradually improved, yet, the sales from the export market remain slow, especially for PVC calendering.
In terms of outlook, the trader contacted by SSESSMENTS.COM believes that PVC prices will show a downturn in the upcoming month. Citing that the India market will be slowing down by the monsoon season in July, whereas China’s domestic prices will also begin to move down by then. Overall, the outlook is not too positive, the trader opined.
