PVC Futures and Spot Markets Increased Dramatically

1.PVC Price

2. Chinese PVC Market Review

The Chinese PVC market was active during Jun 30-Jul 6, 2017. The PVC market was in short supply and the downstream demand was high. Some upstream producers presold their products and the available supply was tight. As a result, the PVC prices in this week increased continually. Up to July 6, the average price of SG-5 produces via calcium carbide method was RMB 6,423/mt, which was up RMB 315/mt or 5.2% W-O-W. The average price of PVC 1000 produced via ethylene method was RMB 6,618/mt, which was up RMB 58/mt or 0.88% W-O-W.

3. Calcium Carbide Market Analysis

The calcium carbide purchasing price in Tianjin, Northeast China, Hebei, Shandong, Henan and Shaanxi increased and the increase range was between RMB 30/mt and RMB 50/mt. during Jun 30-Jul 6, 2017.

The calcium carbide purchasing price in Tianjin and Northeast China increased RMB 50/mt. However, as downstream users of calcium carbide saw increased supply, the calcium carbide purchasing price increased slightly.

The calcium carbide factories in Inner Mongolia decreased output temporarily. Therefore, the downstream supply was shaky and the prices continued increasing. The purchasing prices in various regions were in a equal level.

The overall supply distribution of calcium carbide was unbalanced. The prices adjustment was based on the supply-demand of calcium carbide. The output and supply of factories in Wuhai and Ningxia were stable. The ex-works price of low-end PVC increased. Part of companies in Shandong and Anhui stopped purchasing calcium carbide, the interest of traders decreased from last week. The supply in Shaanxi, WulanCabu, Ordos and Gansu was tense.

4. PVC Market Outlook

Calcium Carbide: Firstly, although the safety and environment protection inspection is strict, the operating rate of calcium carbide will increase gradually. As a result, the output will trend flat to up. Secondly, as the PVC prices will increase noticeably, the operating rate will be high. The purchasing of calcium carbide will be active. Thirdly, as the blue carbon and PVC price will rise slightly and supply of lime rock will be tense, the calcium carbide price will be up. In general, the supply-demand relationship of calcium will be relief. The calcium carbide price will be at a high level and fluctuate within in a narrow range, because the prices of upstream and downstream will increase.

Market Supply: The PVC operating rate will be high. However, the inventories in Northwest, East and South China will continue to decrease and will be tight in some area because of the increasing booking order. It is predicted that PVC inventory will be at a low level.

Downstream Demand: The downstream operating rate will be flat and order will be stable. Influenced by the ‘buy-high’ mentality， the downstream market of PVC will be maintain a high level.

In general, the calcium carbide price will be in a high level and increase slightly in part place. The supply of PVC will be low and the inventory will be tense. Buyers will be bullish about the price. The PVC price will be up. It is predicted that the average price of SG-5 in East China will be in the range of RMB 6,500-6,600/mt, while it in South China will be in the range of RMB 6,500-6,600/mt.