This Week's PVC Market Rebounds (12.22-26)

December 26th, News

I. Price Trends

According to the commodity market analysis system, this week (12.22-26) the PVC spot market in China stopped falling and rebounded, with a noticeable price increase. As of Friday, the average price of SG-5 type PVC produced by the calcium carbide method in China was 4,450 CNY/ton, rising 1.95% within the week.

II. Market Analysis

Supply side: This week, the spot market for PVC in China showed a stronger speculative buying sentiment, with the spot market rebounding driven by the futures market. The market performance indicated an improvement in supply and demand. This week, the operating rate of PVC production in China slightly decreased, with some enterprises operating at less than 50% capacity. In addition, this was mainly due to the increase in trading volume and the improvement in market sentiment.

In terms of inventory, the market has maintained a high volume of transactions recently, and social inventory has continued to decrease. However, considering the previously massive base inventory volume, the current spot supply remains abundant.

On the cost side: Although the market price of calcium carbide fell slightly this week, the market remains in an upward trend, and calcium carbide prices are still at a relatively high level for this stage. According to monitoring data, as we enter December, calcium carbide prices continue to rise, with an increase of 2.29%. Increased purchasing activity downstream has provided some stimulus, and PVC prices have begun to show a rebound trend.

III. Future Market Forecast

PVC analysts believe that in the short term, PVC supply is sufficient, and there is room for manufacturers to increase their operating rates later. Corporate inventories are still generally high and need to be continuously reduced. The short-term rebound in the futures market is more due to improved market sentiment, as the fundamentals of PVC lack sustained momentum for improvement. As downstream purchasing returns to rationality, the supportive effect of positive factors is not obvious. The price increase should be viewed with caution.