Local PVC markets plunge in India, Southeast Asia
Oct. 08, 2018
PVC suppliers in India and Southeast Asia approached their domestic markets with sizeable decreases last week as demand was persistently unsupportive. This was despite the fact that tumbling currencies have pushed buyers to source locally.
In India, the market sentiment remained weak although the monsoon season is ending and crude oil futures have surged. Converters elected to limit their purchases for October, pointing to unstable economic conditions. Accordingly, a local PVC producer cut its prices by INR3000/ton ($41/ton) as of October 1.
Data from ChemOrbis Price Index suggest that the weekly average of local PVC prices in India has hit its lowest level since December 2017.
There was a similar situation in the local PVC markets across Southeast Asia.
In Vietnam, a local producer applied visible decreases of VND1,400,000-1,800,000/ton ($60-77/ton) on its October PVC offers, saying, “We don’t have any export allocation for this month as our supply is not high. VCM costs are high while crude oil futures are surging. Despite these factors, the market remains on a soft note in the face of unsupportive demand. We hope that buying interest will gradually pick up as the rainy season is about to end.”
Vietnam’s local PVC k67 market has decreased to this year’s lowest level, according to ChemOrbis Price Index data.
Traders in Malaysia reported that locally-held PVC 67 prices were also down by MYR200/ton ($48/ton) on the week. A packaging converter opined, “The market is full of uncertainty. The end of the year is approaching, yet demand is still slow. Spot ethylene prices are not responding to the bullish crude oil and the overall sentiment remains fragile.”
The weekly average of PVC k67 prices on FD Malaysia basis has hit its lowest level since mid-December 2017 as ChemOrbis data reveal.
A producer in the Philippines lowered its new offers significantly by $90/ton from last month. “Buyers are accepting our new offer levels as they need to replenish their stocks for Christmas preparations. The depreciation of the peso is keeping them away from the import market,” a producer source said.
Following the producer’s sizeable drop, the local PVC k67 market sank to an almost 10-month low.