Asia PVC markets see longest rising streak ever on extreme tightness.

http://www.petrotahlil.com/en/tiny/news-45406

Petrotahlil - According to the weekly average data obtained from ChemOrbis Price Index, import PVC prices in Asia have been on a constant uptrend since May. This six-month rally indicates the longest rising streak since ChemOrbis started keeping records in 2008.

PVC K67-68 prices on CIF Southeast Asia/India basis are currently standing $1095/ton and $1170/ton, respectively, reaching their highest in nine years. Prices on CIF China basis, meanwhile, are standing at $1070/ton, their highest levels in six years.

Taiwanese major hikes offers to Asia for 6th month in a row

Matching with most market players’ initial expectations, a major Taiwanese producer has announced its November PVC prices to Asia with notable increases due to the ongoing tightness across global markets.

PVC K67-68 offers to India for November are up by $100/ton from October and by $90/ton to China, standing at $1120/ton CIF India and $1060/ton CFR China.

The major producer has been applying hikes since its June pricing, with some of them nearing/standing at three-digits.

When compared to June levels, the producer’s recent PVC K67-68 offers to China and India have gained around 51%.

Tightness plays leading part in long-term uptrend

The global dearth of PVC supply has been triggered by plant issues in the US amid back-to-back hurricanes, limiting exports from the area.

A source from a South Korean producer commented, “There will unlikely be any deep sea US Gulf cargoes heading to Asia until early next year and about half of Asian PVC demand is met by imports of deep sea cargoes. The earliest US Gulf cargoes will arrive in Asia will likely be January 2021.”

A force majeure by Inovyn on material from its north European plants along with plant issues in Taiwan by Asian producers have added to the shortage.

For up-to-date PVC production news, please visit PVC Production News.

Will steep hikes see acceptance?

After several months of steep hikes driven by the global tightness, players are now questioning whether Asian buyers will show tolerance to the prevailing market levels.

Demand in Southeast Asia is already weak amid resurgence of COVID-19 cases while in China, where players mostly focus on exporting, the latest offer levels may meet resistance, some market players believe.

However, according to some, a China-based distributor of the major Taiwanese producer was able to sell out its November allocation immediately after the price announcement.

Still, there are reports that some Indian buyers have already started to substitute around 20% of their PVC requirements with HDPE pipe due to super high price levels.

Source : ChemOrbis

END