PVC market preserves stability amid quiet activity in Italy
Aug. 21, 2018
In Italy, trading activities have notably slackened this week given the beginning of the summer holidays for most PVC players. After the August ethylene contract settled stable last week, initial PVC offers have emerged mainly with rollovers, supporting the calmness of the market.
Spot PVC prices were reported mainly unchanged over the week at 930-1030/ton for k67, at 960-1050/ton for k70 and at 950-1040/ton for specialty grades, FD, 60 days.
As was widely anticipated in last week’s analysis, PVC suppliers have started to reveal their offers for August mainly with rollovers, considering that supply is comfortable and demand is rather calm due to the period. A West European producer said, “We are aware of the fact that demand will be flimsy in Italy this month. However, we are not willing to concede to any discount as we aim to preserve our margins.” On the other side, some suppliers reported to be open to negotiate with their customers for small decreases of 5/ton. A Central European producer is conducting a planned maintenance at their plant that will last until the middle of the month. Yet, a source from the producer confirmed that they have enough stocks to cover the current demand, while he doesn’t exclude the possibility to give small discounts later in the month.
Buyers mostly decided to skip their purchases during August as they are covered already until September, considering that they will halt their production for two or three weeks. Some other buyers are limiting their purchases to their reduced needs, with a converter commenting, “We have closed our deals with one of our regular supplier, paying a 5/ton decrease. We may be able to obtain small reductions also from other suppliers during the month.”
As for the weeks ahead, players don’t expect to see major changes in the market, considering comfortable supply and the limited trading activities amid summer break. Some buyers planned to conclude their deals towards the end of the month, when they will be back from holidays, while some of them started to voice their early expectations for a stable trend also in September.