- Local and import offers firmer after build-up of positive sentiment
- Demand picked up after lockdown relaxations
- Outlook in Q3 highly depends on severity of monsoon season and Coronavirus outbreak
SSESSMENTS.COM data showed that India PVC market gained traction moving towards the end of Q2 2020 after a mediocre performance in April amid the coronavirus pandemic. In the first half of April, SSESSMENTS.COM noted that transactions only came from essential products which were supporting the lockdown in India since March 24. Going into the second half of April, the leading Indian PVC producer announced price protection in a bid to improve domestic sales. At that moment, local prices retreated to below INR70,000/ton-level ($939/ton) with localized cargoes from Far East Asia and Southeast Asia following behind.
Market activities resumed early May as the government applied new lockdown rules in which regions are grouped in green, yellow and red areas based on severity of coronavirus impact. However, the development was still responded negatively, in which local ethylene-based PVC prices were corrected down by INR3,500/ton ($46/ton). Market activities started to show positive movement in the second week of May as relaxation on the lockdown rules was applied with the leading PVC producer made a total increase of INR7,000/ton ($93/ton) at the end of May. For localized cargoes in May, SSESSMENTS.COM pricing database showed offers also went up following the price changes on local cargoes.
With businesses embracing remaining time between re-opening after lockdown and before monsoon kicks in, India PVC market recorded an upswing with an increase of INR2,000/ton per week for local and localized cargoes during the first half of June. SSESSMENTS.COM observed that the market then started to retreat in the second half of June. Offers from the leading Indian PVC producer still can be found at INR73,000/ton ($979/ton), INR5,500/ton ($73/ton) higher compared to offers in early June. For localized cargoes, offers for cargoes from East Europe, Far East Asia, and Southeast Asia were available between INR71,000-73,000/ton ($952-979/ton).
From the import market, considering the VCM price around $400/ton-level in April and ample supply on traders and producers’ end by that time, some sources pointed out that offers for May shipment PVC cargoes to India market should be below $700/ton-level on CIF basis. These levels were seen towards the end of the month for Russian cargoes, available between $600-625/ton with deals concluded at $600/ton on CIF basis. Meanwhile, the leading Taiwanese PVC producer made a decision to skip May shipment offers to the country due to the extended lockdown. A positive development then happened in May as import offers for June shipments from the leading Taiwanese PVC producer surfaced at $740/ton on LC at sight, CIF Nhava Sheva port before volume discount. Taiwanese producer’s then informed SSESSMENTS.COM that for July shipment, there was an increase by $100/ton as compared to June shipment, however, as most customers already purchased in big quantities in the previous month, the buyers reduced the buying quantity or skip procurements.
In general, demand was sluggish as trading activities were winding down in April since most downstream factories in the country were forced to halt production until further notice during the nationwide lockdown. Demand for PVC in India then improved week by week during May. More and more manufacturers resumed operation after the government lifted nationwide lockdown restrictions. In the first two weeks of the month, the production rate of the converters in the orange and green zone increased up to 70-80% for the small ones and 50-70% for the big ones. Coming into the end of June, an uptrend from May starting to dim. The main cause was due to lockdown still imposed in some areas, and the restriction of movement caused a lack of manpower. Also, the monsoon started descending around India in the second half of June. Although demand from the agriculture sector started to show signs of slowing down, SSESSMENTS.COM noted that most pipe manufacturers still run at a reasonable rate to build up the inventory for sales after the rainy season ends. Talking about supply, shipment disruption was reported throughout April due to lockdown. High inventory was also reported at this time by traders and producers since downstream converters cannot absorb the supply as a result of temporary shut down in production. With demand pick up going into May, the availability of materials in the market was limited due to fewer import cargoes entering the country. In June, some areas such as Gujarat, Maharashtra, and Tamil Nadu still faced extended lockdown, causing a shortage of workforce which also led to logistic disruption.
Talking about demand outlook, healthy projection is predicted to last until the rainy season begins at the start of Q3. With end-product demand slowing down amid monsoon, most players voiced out their expectation to SSESSMENTS.COM that the price should be lower in the local as well as import market.
Transactions for local/localized ethylene-based PVC in April on cash, EXW basis and excluding 18% GST in all terms
| Origin | Transaction Type | Offers (INR/ton) | Equivalent in USD/ton | Delivery Location |
|---|
| India | Offer Given | 66,000-72,000 | 885-966 | Mumbai |
| India | Offer Received | 64,000-72,000 | 858-966 | Mumbai |
| India | Offer Received | 68,900 | 924 | Delhi |
| India | Offer Received | 68,000 | 912 | Kolkata |
| India | Purchased | 65,000* | 872 | India |
| Russia | Offer Given | 61,500-62,000 | 825-831 | Delhi |
| South Korea | Offer Given | 65,000-66,000 | 872-885 | Delhi |
| Taiwan | Offer Given | 66,000-67,000 | 885-898 | Mumbai |
| Taiwan | Offer Given | 65,000-66,000 | 872-885 | Delhi |
| Thailand | Offer Given | 61,500-62,000 | 825-831 | Delhi |
| Thailand | Purchased | 64,000 | 858 | Chennai |
| Ukraine | Offer Received | 63,000 | 845 | Mumbai |
Description: *FD basis
Transactions for import ethylene-based PVC in April, CIF India Main Port basis
| Origin | Transaction Type | Offers (USD/ton) | Payment Term |
|---|
| Central Asia | Offer Received | 620*-625 | LC at sight |
| Central Asia | Purchased | 600* | LC 90 days |
| Central Asia | Sold | 625 | LC 90 days |
| Far East Asia | Buy Idea | 680-700 | LC at sight |
| Far East Asia | Offer Given | 810-820 | LC 90 days |
| Far East Asia | Offer Received | 650-810 | LC at sight |
| North America | Offer Received | 550* | LC at sight |
| North America | Offer Received | 620-650 | LC 90 days |
Description: *May shipments
Transactions for local/localized ethylene-based PVC in May on cash, EXW basis and excluding 18% GST in all terms
| Origin | Transaction Type | Offers (INR/ton) | Equivalent in USD/ton | Delivery Location |
|---|
| India | Offer Given | 63,000-69,000 | 845-925 | Cuddalore |
| India | Offer Given | 62,000-63,500 | 831-852 | Delhi |
| India | Offer Given | 62,500-68,500 | 838-919 | Mumbai |
| India | Offer Given | 73,500 | 986 | Ahmedabad |
| India | Offer Received | 63,000 | 845 | Mumbai |
| India | Offer Received | 65,000 | 872 | Kolkata |
| India | Purchased* | 62,000-64,000 | 831-858 | Bengaluru |
| India | Sold | 63,000-69,000 | 845-925 | Cuddalore |
| India | Sold | 73,000 | 979 | Ahmedabad |
| Iran | Purchased | 58,500 | 784 | Mumbai |
| Japan | Purchased | 61,000 | 818 | Chennai |
| Russia | Offer Given | 59,500-63,000 | 798-845 | Mumbai |
| Russia | Offer Given | 61,500 | 825 | Ahmedabad |
| Russia | Offer Given | 61,000 | 818 | Delhi |
| Russia | Offer Received | 71,000 | 952 | Mumbai |
| Russia | Sell Idea | 61,500-62,000 | 825-831 | Delhi |
| Russia | Sold | 61,500 | 825 | Ahmedabad |
| Russia | Sold | 63,000 | 845 | Mumbai |
| South Korea | Offer Given | 63,000-74,000 | 845-992 | Delhi |
| South Korea | Offer Received | 72,000 | 966 | Mumbai |
| South Korea | Sell Idea | 65,000-66,000 | 872-885 | Delhi |
| South Korea | Sell Idea | 71,000-73,000 | 952-979 | Mumbai |
| South Korea | Sold | 71,000 | 952 | Delhi |
| Taiwan | Offer Given | 63,000 | 845 | Delhi |
| Taiwan | Offer Given | 62,000-63,000 | 831-845 | Mumbai |
| Taiwan | Offer Received | 72,000 | 966 | Mumbai |
| Taiwan | Sell Idea | 65,000-66,000 | 872-885 | Delhi |
| Taiwan | Sell Idea | 71,000-73,000 | 952-979 | Mumbai |
| Taiwan | Sold | 62,750-63,000 | 841-845 | Mumbai |
| Thailand | Bid Received | 70,500 | 945 | Delhi |
| Thailand | Offer Given | 61,000-74,000 | 818-992 | Delhi |
| Thailand | Offer Given | 67,000-68,000 | 898-912 | Mumbai |
| Thailand | Offer Received | 65,000 | 872 | Chennai |
| Thailand | Purchased | 61,000 | 818 | Chennai |
| Thailand | Sell Idea | 61,500-62,000 | 825-831 | Delhi |
| Ukraine | Offer Given | 60,000 | 805 | Mumbai |
| Ukraine | Purchased | 70,500 | 945 | Nhava Sheva |
| USA | Purchased | 70,000 | 939 | Chennai |
Description: *FD basis
Transactions for import ethylene-based PVC in May, CIF India Main Port basis
| Origin | Transaction Type | Offers (USD/ton) | Payment Term |
|---|
| Central Asia | Offer Given | 700 | LC at sight |
| Central Asia | Offer Received | 620-740 | LC at sight |
| Europe | Offer Received | 690-730 | LC at sight |
| Europe | Offer Received | 650-700 | LC 90 days |
| Europe | Sold | 700-710 | LC at sight |
| Far East Asia | Buy Idea | 680-720 | LC at sight |
| Far East Asia | Offer Given | 730-760 | LC at sight |
| Far East Asia | Offer Received | 730-760 | LC at sight |
| Far East Asia | Purchased | 740 | LC at sight |
| Far East Asia | Sell Idea | 720-750 | LC at sight |
| Far East Asia | Sold | 730-760 | LC at sight |
| Southeast Asia | Offer Received | 730-755 | LC at sight |
| Southeast Asia | Purchased | 760 | LC at sight |
| Southeast Asia | Sold | 740-760 | LC at sight |
Transactions for local/localized ethylene-based PVC in June on cash, EXW basis and excluding 18% GST in all terms
| Origin | Transaction Type | Offers (INR/ton) | Equivalent in USD/ton | Delivery Location |
|---|
| India | Offer Given | 69,000-71,000 | 925-952 | Cuddalore |
| India | Offer Given | 74,000 | 992 | Delhi |
| India | Offer Given | 68,500-73,500 | 919-986 | Mumbai |
| India | Offer Received | 72,000 | 966 | Mumbai |
| India | Purchased** | 70,500-73,000 | 945-979 | Bengaluru |
| India | Purchased | 69,500-72,000 | 932-966 | Mumbai |
| India | Sold | 69,000 | 925 | Cuddalore |
| India | Sold | 70,500-73,500 | 945-986 | Mumbai |
| Japan | Offer Given | 71,000-72,000 | 952-966 | Delhi |
| Japan | Offer Received | 73,000-74,000 | 979-992 | Kolkata |
| Japan | Purchased | 76,000 | 1,019 | Kolkata |
| Japan | Purchased | 70,000-72,500 | 939-972 | Mumbai |
| Mexico | Offer Given | 69,000 | 925 | Mumbai |
| Russia | Offer Given | 72,000 | 966 | Ahmedabad |
| Russia | Offer Given | 71,000-75,000 | 952-1,006 | Delhi |
| Russia | Offer Given | 69,000-72,000 | 925-966 | Mumbai |
| Russia | Purchased | 70,500 | 945 | Mumbai |
| South Korea | Offer Given | 70,000-73,000 | 939-979 | Ahmedabad |
| South Korea | Offer Given* | 71,000 | 952 | Ahmedabad |
| South Korea | Offer Given | 74,000 | 992 | Chennai |
| South Korea | Offer Given | 71,500-76,000 | 959-1,019 | Delhi |
| South Korea | Offer Given | 71,000-74,000 | 952-992 | Mumbai |
| South Korea | Offer Received | 72,000-73,000 | 966-979 | Mumbai |
| South Korea | Sold | 72,000-72,500 | 966-972 | Mumbai |
| Taiwan | Offer Given | 70,000-73,000 | 939-979 | Ahmedabad |
| Taiwan | Offer Given* | 71,000 | 952 | Ahmedabad |
| Taiwan | Offer Given | 71,000-76,000 | 952-1,019 | Delhi |
| Taiwan | Offer Given | 70,000-74,000 | 939-992 | Mumbai |
| Taiwan | Offer Given | 72,000-74,000 | 966-992 | Nhava Sheva |
| Taiwan | Sold | 72,000-72,500 | 966-972 | Mumbai |
| Thailand | Offer Given | 71,000 | 952 | Mumbai |
| Thailand | Offer Received | 70,000 | 939 | Mumbai |
| Thailand | Purchased | 70,500 | 945 | Mumbai |
| Ukraine | Offer Given | 71,000-72,000 | 952-966 | Mumbai |
| Ukraine | Offer Received | 75,000 | 1,006 | Chennai |
| USA | Offer Received | 72,000-73,000 | 966-979 | Mumbai |
Description: *offers on 30 days credit term; **FD basis
Transactions for import ethylene-based PVC in June, CIF/CFR India Main Port basis
| Origin | Transaction Type | Offers (USD/ton) | Payment Term |
|---|
| Europe | Offer Given** | 780-820 | LC 90 days |
| Europe | Offer Received | 770-780 | LC at sight |
| Europe | Offer Received | 820-850 | LC 90 days |
| Europe | Offer Received** | 850 | LC 90 days |
| Europe | Price List* | 850 | LC 90 days |
| Far East Asia | Bid Given | 870 | LC at sight |
| Far East Asia | Offer Given | 800-900 | LC at sight |
| Far East Asia | Offer Given | 850-860 | LC 90 days |
| Far East Asia | Offer Received* | 820-850 | LC at sight |
| Far East Asia | Offer Received** | 820-880 | LC at sight |
| Far East Asia | Price List | 830-850 | LC at sight |
| Far East Asia | Price List** | 845 | LC 60 days |
| Far East Asia | Price List** | 840 | LC 90 days |
| Far East Asia | Purchased | 830-840 | LC at sight |
| Far East Asia | Purchased** | 820 | LC at sight |
| Far East Asia | Sell Idea | 830-890 | LC at sight |
| Far East Asia | Sold | 730-900 | LC at sight |
| Latin America | Offer Given | 780 | LC 90 days |
| Latin America | Offer Received | 770 | LC at sight |
| Latin America | Offer Received*** | 805 | LC 90 days |
| Latin America | Purchased | 770 | LC at sight |
| Middle East | Buy Idea | 785-790 | LC at sight |
| Middle East | Price List | 820 | LC at sight |
| Middle East | Sold | 790-800 | LC at sight |
| North America | Offer Given | 760-800 | LC at sight |
| North America | Offer Received** | 760-800 | LC at sight |
| North America | Offer Received** | 780-800 | LC 90 days |
| North America | Purchased | 720 | LC at sight |
| South Africa | Offer Received** | 810 | LC 90 days |
| Southeast Asia | Offer Received | 780 | LC at sight |
| Southeast Asia | Offer Received** | 860-880 | LC at sight |
Description: *June-July shipments offers; **July shipment offers; ***July-August shipment offers
Tags: Asia Pacific,English,ISC,India,PVC,Quarterly
Published on July 7, 2020 11:32 AM (GMT+8)
Last Updated on September 16, 2020 8:58 PM (GMT+8)
