Players of the Asian PVC market are monitoring developments in the Chinese one this week. They think that as soon as demand gets better in China, it will have a ripple effect on the other markets as well. Moreover, Formosa is likely to announce offers for March-shipped PVC soon and prices are expected to get higher. ‘It is difficult to predict the amount of the increase as Chinese demand is still unclear,’ a Chinese distributor has told PVC Market Weekly.

The major Chinese PVC distributors have returned to work after the holidays this week. However, converters are slow to resume operations. Demand from distributors has improved. This, together with optimistic macroeconomic expectations, have led to a PVC appreciation by $20/t to $880—910/t CFR China. Carbide-based PVC has been up for sale at $840—880/t CFR China, $15/t more than last week this one. China’s manufacturing PMI has begun growing again owing to the removal of COVID-19 restrictions. The indicator has increased from 47.0 in December 2022 to 50.1 in January 2023. However, low demand after the holidays aroused worries that demand was overestimated and it may remain the same as before. This has immediately been reflected in lower PVC futures for April. The most actively traded PVC futures for April delivery have depreciated by CNY 449/t ($67/t) week on week to CNY 6,203/t ($921/t) EXW on China’s Dalian Commodity Exchange this Friday. However, foreign suppliers still think that demand is going to increase as the Chinese government cancelled a number of restrictions in the country.

In India, PVC prices have remained stable this week. As demand for PVC has become moderate after mostly the US goods arrived, market players are unwilling to accept PVC price increases. However, all the market players think that as soon as Formosa sets higher prices for March, Indian customers will have to accept them. PVC has been available at $920—960/t CFR India this week.

In Southeast Asia, PVC demand has been largely unchanged this week. In Vietnam, the real estate is still tackling financial and investment issues. Local market players have stopped purchasing PVC this week in anticipation of new PVC offers. PVC has been on offer at $870—910/t CFR SEA, up $15/t on the appreciation of the Chinese resin and positive outlook for the global economy.

Chinese converters are likely to resume working next week, which will push PVC demand up. PVC prices are likely to hold steady if buying will be at a standstill or move $20—40/t up if the major suppliers announce new offers. In Southeast Asia, demand will be mostly the same as now and prices may remain stable in view of dull trade or get $20—40/t higher because of strong macroeconomic expectations. In India, PVC may hold its value until the leading suppliers set PVC offers for March shipment as they have already obtained old orders or go $20—40/t up on bullish sentiments once PVC prices come out.