A trader based in China informed SSESSMENTS.COM that internal and external market picture began to diverge. Local acetylene-based PVC offers from the trader’s end are currently at CNY6,220/ton ($871/ton), an increase of between CNY200-220/ton ($28-30/ton) from last week. Offers are on cash, EXW China basis and including 13% VAT. Adjustment happens as a result of a price increment of raw materials, coupled with tight supply from the producers due to plants’ maintenance.
The trader commented that there was a decline in the total volume of imports and exports for PVC cargoes in April 2020. From the data compiled by SSESSMENTS.COM, total imports for April by 40,000 tons was a decrease of 30% than in March or 28% lower than the same period last year; meanwhile, exports of PVC cargoes reached 45,800 tons making it 46% lower than in March or down 1.72% from last year at the same period. The trader then said that even though the volume of entry and exit is still considered high, deals in their level were weak due to the Chinese PVC offer perceived by offshore customers to be not workable compared to prices offered from other countries/regions. The trader also said that "it is true that the orders for finished goods from export markets are limited," commenting on the condition of downstream factories in China.
Different things are happening in the Chinese internal market with converters relayed to a trader that they have been sitting on high inventory, purchased when prices were low, to welcome demand entering the new month. Demand is currently rising and could be even higher coming to June and July following the direction of the government to stimulate the economy, especially on the real estate sector, which is a mainstay of China's GDP. The trader then told SSESSMENTS.COM that the pricing outlook is optimistic as there is still room for prices to move further up.
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