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Meghmani Finechem Limited (MFL), a leading domestic manufacturer of speciality chemicals, tated on Tuesday stated that it had increased its manufacturing capacity by 1.5 times to 75,000 tonnes annually in anticipation of future development in the production of chlorinated polyvinyl chloride (CPVC) resins. A further 45,000 TPA will be added by the corporation by the fourth quarter of the fiscal year 2023–2024.

CPVC is frequently utilised in the production of pipes for home, industrial, and even sprinkler use due to its high heat resistance and chemical resistance qualities. Meghmani Finechem Limited will be able to cut its capital investment as well as the turnaround time for the expansion because the essential infrastructure needed for it is already in place. Among makers of pipes, the product is generally regarded.

Industry experts predict that CPVC manufacturing will rise by double digits in the upcoming years. At its integrated chemical complex in Dahej, the company put into operation a 30,000 TPA CPVC resin manufacturing facility in July of last year.

The growth will raise the derivatives and specialised divisions' percentage of MFL's overall revenue. The third quarter of the current fiscal year saw revenues for the chemical industry giant increase by 27%.

The company has also announced the commissioning of a captive power plant with a captive caustic soda capacity of 1,06,000 TPA. After the expansion, MFL will have a captive power plant with a capacity of 132 MW and 4,000 TPA of caustic soda production. The facility was put into operation on schedule and for less than the anticipated CAPEX.

The establishment of new derivatives and speciality chemicals, such as Epichlorohydrin (which was put into production on June 1, 2022), CPVC Resin (which was put into production on July 18, 2022), and other future products, will expand the capacity of caustic soda. This increased caustic soda production will serve as raw material for future projects including Epichlorohydrin, CPVC Resin, Chlorotoluene and its value chain, as well as other initiatives that will reinforce FL's fully integrated complex.

North America

The CPVC (Chlorinated Poly Vinyl Chloride) pricing displayed a negative trend as a result of the construction industry's dampened downstream demand, a decline in the US real estate market, and a decline in the price of PVC Resin, the feedstock. High inflation reduced consumer demand on the local market and slowed down output in the area.

The CPVC market was significantly impacted by the lack of consumer confidence. Formosa Plastics reduced feedstock PVC capacity in Baton Rouge (USA) in December and November to go on maintenance shutdowns for ten days each. This was done despite having ample stock availability.

Asia Pacific

All throughout the APAC area, CPVC costs were low. Low downstream demand, rising input cost inflation, and low consumer confidence in the building sector all had an impact on the upward trend in product prices. The lack of market activity brought on by the September typhoons in numerous Asian nations, combined with COVID lockdown measures, has had an impact on the freight costs and overall feedstock PVC costs.

The product prices followed a downward trend as a result of need-based buying attitudes and weak economic conditions in the worldwide market. A new unit will be put into operation in FY24 by the CPVC manufacturer DCW Ltd., increasing the product's capacity in the Indian market.

Europe

Due to the ample supply of stocks and the subpar downstream building demand in the area, CPVC prices saw a downward trend.

In this quarter's European energy crisis and uncertain downstream markets, the value chain of CPVC has been impacted by crude oil price volatility and reduced feedstock PVC prices. Additionally, the market participants were forced to reduce regional profit margins and destock piled-up stocks at reduced prices due to the unfavourable market sentiments for CPVC in the local market.

The main causes of the commodity's sharp price decline were the ease in the price of the feedstock PVC and lower downstream construction sector enquiries in the European market.

As per Procurement Resource, A significant domestic producer of specialty chemicals, Meghmani Finechem Limited (MFL), recently announced that it had boosted its production capacity by 1.5 times to 75,000 tonnes yearly in preparation of future growth in the production of chlorinated polyvinyl chloride (CPVC) resins.