India PVC Market Is On Alert Ahead Of The End Of Lockdown
- Improvement in market activity in the red zone area
- PVC manufacturers that support agriculture can operate during the lockdown
- Players voiced out the same outlook for import PVC prices
A PVC producer based in Delhi told SSESSMENTS.COM that the offers given to the local market this week are INR1,000/ton ($13/ton) higher from last week. The offer from another producer based in Cuddalore at INR63,000/ton ($837/ton), was acceptable to buyers because perceived to be near the bottom. Meanwhile, a local trader based in Delhi gave an offer for localized PVC cargoes of South Korea, Taiwan, Thailand and Russia at INR500-3,000/ton ($6-39/ton) lower compared to sell ideas voiced out last week, citing buyers were not able to accept firm prices yet. In terms of deals, a Mumbai-based trader managed to sell localized PVC cargoes of Taiwan origin at the initial offer level at INR62,750-63,000/ton ($833-837/ton). All local offers are on cash, EXW basis and excluding 18% GST, and depending on delivery location. From the import market, the leading Taiwanese PVC producer is expected to announce its June shipment offers to India after the lockdown lifted, or after May 17. While some traders voiced out buy ideas for June shipment for Taiwanese cargoes at $680-720/ton-level.
The Delhi-based producer shared with SSESSMENTS.COM that domestic PVC demand is improving from last week citing that converters keep buying cargoes even though factories remain shut to anticipate higher prices in the days to come. Better conditions are also observed in Mumbai and Cuddalore as most manufacturers have been able to run their production up to 40-60% from normal output. With the arrival of orders from the export market, the manufacturers expect to be able to run in full capacity but it is not possible under strict government regulations for the industry during COVID-19. No significant issues in supply were reported.
Regarding the outlook, market players contacted by SSESSMENTS.COM agreed that import PVC offers would be in an upward trajectory. How fast the increase can occur according to the players is determined by the market’s ability to absorb inventory after the lockdown ends. Offers from local and import markets are expected to remain competitive for the time being.
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