Market sources informed SSESSMENTS.COM that Formosa Plastics USA, Westlake Chemical, Shintech, and OxyChem on July 16-17 announced a 3 cents/pound increment for their polyvinyl chloride (PVC) sold in the domestic market for August. The adjustment follows increases with the same amount accepted for June and sought for July.
US PVC prices fell 8 cents/pound in April and May amid widespread coronavirus pandemic which shut businesses and stalled buying activity. Demand showed a robust recovery by late May and producers announced 3 cents/pound price rise for June that was accepted and sought another 3 cents/pound increment for July.
Some market participants told SSESSMENTS.COM that the July increase might face resistance from the market. However, PVC availability has been tightening in the US. Despite stronger PVC demand, US chlor-alkali rates unexpectedly dropped from 75% in May to 72% in June, causing tightness in supply of ethylene dichloride. Rates plunged from 90% in March to 68% in April amid widespread coronavirus-related shutdowns in the country.
In addition, Formosa Plastics USA has shut its 513,000 mt/year PVC plant in Baton Rouge, Louisiana and its 736,000 mt/year chlor-alkali plant in Point Comfort, Texas for turnarounds which are expected to complete in the next several days. Westlake Chemical’s VCM unit at Lake Charles, Louisiana, is also experiencing an outage.
