Players in Turkey reported that Asian PVC cargoes re-emerged in the market after a lengthy absence, which players took to be an indication of the lack of healthy demand within the Asian region. Initial April import prices to China and Southeast Asia from a Taiwanese major were announced with $40/ton decreases and other regional producers are expected to implemented similar price declines. The producer added that they had not announced their new prices to India yet as they are waiting for the government to announce its decision regarding PVC anti-dumping duties. Players say that the government is expected to decide on its new anti-dumping duties by April 4.
Import PVC prices on a CFR Turkey basis have started to trade at a premium to CFR China prices over the past few weeks for the first time since December of 2013, according to data from ChemOrbis Price Index. Players commented that the premium of around $15/ton would not normally be considered large enough to offset the additional shipping costs Asian sellers face when offering to Turkey rather than China and that the decision to move cargoes to Turkey is more likely a reflection of insufficient demand within the region.
A Turkish trader who reported receiving offers for Taiwanese and Thai PVC commented, “American PVC prices may move lower now that attractively-priced Asian cargoes have made an appearance on the market.” Another trader based in Turkey said that they had heard that some sellers in Europe had tried to divert their PVC cargoes to China but ultimately had to resume their offers to Turkey as they were not satisfied with the prices they could achieve in the Chinese market. A profile manufacturer reported that they also received offers for Thai PVC this week. “The emergence of Asian cargoes in Turkey should signal the beginning of a downturn, which we believe will also weigh down prices from Europe and the US,” the buyer stated. According to ChemOrbis data, imports from Asia accounted for only 3.6% of Turkey’s total PVC imports for 2013.
Players in Asia confirmed that regional PVC demand is sluggish, commenting that reduced supplies from the US, which accounted for around one third of China’s total PVC imports for 2013, had not given Asian sellers sufficient support to maintain a stable pricing trend. “India has imported around 50,000 tons of Chinese acetylene-based PVC since late February and this has maintained downward pressure on regular import origins,” a trader based in India reported. An agent of a Taiwanese producer stated, “Regional prices are falling even though spot VCM costs remain firm, which we take as a sign that demand is not good. We have heard that American suppliers may also reduce their April prices by around $50/ton to maintain their competitiveness.” A trader based in Malaysia reported, “We are struggling to sell even though our offers for Chinese origins are standing close to the low end of the overall range. We are holding sufficient stock levels and are willing to negotiate with buyers placing firm bids.”
Source: ChemOrbis
