Market Players: Rainy Season Minimal Impact On Southeast Asia PVC Demand For Now
- Significant adjustment captured on local and localized PVC offers in Malaysia
- Rainy season gives minimal impact in both Thailand and Philippines market
- Room for August shipment offers to increase is limited
Southeast Asian market participants shared with SSESSMENTS.COM that the rainy season has minimal impact on the Southeast Asia PVC market for now. On the week commencing June 29, PVC offers in the domestic market captured stable to firmer. In Malaysia, following the international trend, a trader adjusted up July delivery offers for localized Chinese and South Korean ethylene-based PVC as well as Chinese acetylene-based PVC by MYR350/ton ($82/ton) from June delivery. Likewise in Thailand, on the monthly comparison, local producers increased July delivery offers for ethylene-based PVC offers by THB2,000/ton ($65/ton). However, the producers are willing to give THB1,000/ton ($32/ton) discount depending on the volume purchased. While in the Philippines, a local ethylene-based PVC producer maintained stable offers from last week. In the import market, offers for acetylene-based PVC from a Chinese producer to Malaysia are available at $20/ton lower compared to the offers in the middle of June. Still, despite the adjustment, the offers are deemed too high. For Thai cargoes, a converter in Malaysia decided to halt procurements for July shipment as offers are unattractive whilst a second converter plans to purchase Thai PVC cargoes for August shipment with buy idea at the same level to July shipment at $810/ton on LC at sight, CIF Malaysia Main Port basis. Detailed information for Indonesia and Vietnam market is available in WeeklySSESSMENTS of the respective countries.
As informed to SSESSMENTS.COM, the rainy season is yet to have impact in both Thailand and Philippines market. PVC demand in the Philippines remains healthy this week. Meanwhile, in Thailand, healthy demand is captured only for the pipe and medical sectors, while other sectors remain sluggish. As for Malaysia, the PVC market has improved each week, especially for the compounding sector as most converters in this sector are currently running at 50-60% from normal capacity. However, a Malaysian trader stated that PVC sales at the company’s end is slow as price changes for July delivery were too steep. In the production sector, Thai SCG plans to conduct maintenance at the company’s 530,000 tons/year PVC plant for a week in July. Likewise, Thai Vinythai will also conduct maintenance shutdown in the upcoming months, however, no further details regarding the schedule so far. While Philippines’ General Chemical & Resins Consortium Inc (GenChem) has been running at full capacity after facing a production glitch last week. On the supply side, no significant issue was reported.
For the outlook, Southeast Asian market players believed that PVC demand in the region will be slower once the rainy season intensifies. As for pricing, the room for August shipment offers to increase is limited as India as the main PVC importer will be in the low season due to the monsoon, as stated to SSESSMENTS.COM.
