About: PVC or Poly Vinyl Chloride is a thermoplastic polymer that is also a synthetic resin. Owing to its versatile nature, PVC has become one of the most widely used polymers in the world. It is known to be chemically resistant to several materials such as acids, salts and fats. It is produced by a process called polymerisation. It is used in plethora of places like water pipes, electronics, packaging, etc. PVC is the third-most widely manufactured synthetic plastic polymer worldwide.
Get the latest insights on price movement and trend analysis of PVC in different regions across the world (Asia, Europe, North America, Latin America, and the Middle East & Africa).
In the Chinese market, sluggish demand for Poly Vinyl Chloride amid weak upstream feedstock Calcium Carbide led to decreasing price trend for PVC. A rise in Covid-19 cases in China led to congestion of ports which further dropped transportation activities. The uncertainty of the pandemic affected offtakes from the downstream industries. Producers reduced production rates due to continuous lockdowns and rigid quarantine protocols. Additionally, the price of feedstock calcium carbide decreased at the beginning of April in China as the number of Covid 19 cases climbed again which reduced the demand amid abundant stocks in the domestic market of China. Most market distributors were forced to sell their stocks in the regional market due to logistical bottlenecks like unavailability of rail, car and truck services. Towards the end of May, price of PVC5 type was somewhere around 8600 RMB/MT.
Poly Vinyl Chloride market observed a surge in prices in Europe, supported by the high demand from the end-use downstream segments. The ongoing war between Ukraine and Russia led to soaring high values of energy which pushed raw material costs to rise in the European markets. Demand from downstream automotive segments for PVC also remained high in the region while supply remained limited and profits were squeezed.
PVC prices in July had dropped by 50-80 EUR/MT in Europe as a result of increased availability and high demand from downstream sectors.
In North America, PVC prices surged at the end of April 2022 amid supply disruption as ports were congested at various container terminals, leading to a shortage of feedstock ethylene. Rising tensions between Ukraine and Russia eventually congested ports in the USA.
The average domestic spot price of PVC5 type was 8,880 RMB/MT on March 29, down 0.56% from the previous trading day but up 3% year on year. The disc was on the strong side, and the spot market's environment was heating up because of the upward trend in futures. The investors' offer grew, and the market's attention shifted upward. Following the price increase, downstream enquiries were usual, high-priced transactions were normal, and actual deals were mostly negotiated. Towards the end of March, the price of PVC was around 8,900-9,300 RMB/MT.
The availability of raw materials for PVC was anticipated to decrease in Q1 due to a slew of turnarounds planned at chlor-alkali facilities. Players' margins are projected to narrow as they will be unable to pass on the cost pressure to customers if the demand environment continues unchanged. On the other hand, because chlorine availability is predicted to drop, a scarcity of PVC could occur in late Q1, putting the operating rate of numerous PVC plants at risk.
With supply exceeding demand, Pipe Grade prices in China fell to a record low of 1345 USD/MT FOB Shanghai in December, while Calendaring Grade prices remained stable at 1740 USD/MT.
The market sentiment first increased in October before seeing a sharp decline by the end of December. PVC prices continued to rise in October, owing to strong demand from the packaging and construction sectors during the peak Christmas season. After reaching a record high of 161.84 INR/kg on October 14, 2021, Indian manufacturers lowered their PVC resin prices weekly in response to global market conditions. PVC prices in the GCC (Gulf Cooperation Council) area of the Middle East fell by more than 20% to trade at around 1600-1650 USD/MT, down from a record high of 2050-2120 USD/MT in early November 2021.
In December, Suspension Grade PVC prices in Europe hit 2050 USD/MT FD Germany. Europe was experiencing a severe scarcity of Vinyl Chloride Monomer (VCM), forcing a major PVC producer, Vynova, to operate both of its plants in Belgium at less than 50% capacity. Additionally, Vinnolit's force majeure at its caustic soda facility resulted in a decline in the availability of its feedstock chlorine in the first part of the quarter. Although feedstock supplies began to stabilize in late November, PVC prices continued to rise steadily as a result of lower output and high energy prices.
In December, supply outstripped demand, resulting in a month-long decline in the prices. In the final week of December, the prices fell to 1680 USD/MT FOB Texas for Suspension Grade. Due to the interdependence of the Chlor-Alkali and PVC markets, constrained production of caustic soda due to low operating rates as a result of the Ida hurricane in mid-Q2 2021 continued to strain supplies in the quarter ending December. After reaching an all-time high in November, PVC prices subsequently fell owing to the off-season’s lack of demand.
In April, the Asian market saw robust demand from the downstream construction industry, which then dropped in May. During April, manufacturers in China were effortlessly shipping PVC to the Indian market at rather high costs. The sharp increase of pandemic cases in India lowered its demand in the related building market. As a result, PVC prices in the Indian market fell in the second half of the quarter reaching 1617 USD/MT in the final week of June.
Further, PVC prices increased rapidly during the second quarter, owing to strong demand from the local market and inadequate cargo supply. Increased shipping container pricing and increased freight costs across Southeast Asia aided in the quarter's price increase trend. Additionally, the winter storm that swept across the US Gulf area interrupted global supplies and harmed Asia's commercial activities. Additionally, the Chinese market's bullish demand for the polymer helped the price in other APAC nations, such as India. The CFR price in India increased by approximately 30% in March and ended at 1615.97 USD/MT.
PVC prices increased significantly in the Asia Pacific area during the third quarter of 2021. The pricing trend continued to rise in the face of an active polymer market and a worldwide supply shortfall. In India, pricing increased significantly, with CFR ICD Delhi prices increasing from 1429 USD /MT to 1680 USD/MT in Q3 2021.
Europe saw a significant increase in the price of PVC, owing to a strong demand pattern and major feedstock and material shortages. During this period, shipments from Europe increased overall in Q1 2021, owing to decreasing manufacturing along the US Gulf coast. Due to rising freight costs and a lack of shipping containers, prices increased to over 113 USD/MT in several CIS nations. Domestic output remained constrained across the area owing to planned and unanticipated plant shutdowns.
In Q3 2021, the general market prognosis for the polymer in Europe indicated an increasing trend. The pricing chart demonstrated an increased trend in the market during September, owing to a severe lack of raw materials, which resulted in an increase in regional prices. Shipment costs were stable as congestion in ports remained a major concern. Additionally, logistical concerns such as container shortages and rising freight prices added value to all imported goods in Europe during this quarter.
North America’s production was hampered by a severe freezing storm across the gulf, forcing the overall output to its lowest level in Q1 2021. Due to the disruption caused by the winter storm, the supply of feedstock materials such as monomer vinyl chloride was decreased, and strong demand from both the local and foreign markets pushed prices upward. As a result, the region's average price increased by 16.83% and settled at 1717.5 USD/MT in March.
After experiencing record increases through the end of April, PVC prices began to normalize in May as supply activity in the United States improved. The resurgence of the North American market following a successful immunization campaign increased demand for PVC in the domestic building industry. Since late August, when Hurricane Ida made landfall on 29th August, key manufacturing factories from Baton Rouge to New Orleans along the Mississippi river, which accounted for over half of US PVC output, had been forced to shut down. Since the first week of September, PVC prices had been soaring, reaching an all-time high of 1960 USD/MT FOB Louisiana and 1940 USD/MT FOB Texas in September. However, prices moderated in the last week of September as output increased as a result of plant restarts in Texas and Louisiana.
Asia witnessed supply shortage as producers dumped cargoes, resulting in smaller product inventories. The supply shortage was exacerbated further when a major manufacturer in Northeast Asia went into maintenance mode. As a result of several nations' success in containing the spread of contagion, market activity gradually rose towards the end of the quarter, owing to the region's continued relaxation of restriction measures. Traders reported increasing purchases as customers expressed optimism about future demand resuscitation following the restart of production in the majority of downstream businesses. With multiple scheduled plant outages planned for later in the year, that the demand-supply imbalance was anticipated to worsen.
Levitating at the highest in at least five years, the market price had an increase of 60% from its level of 88.55 INR/kg a year ago and more than 125% climb from the worldwide shutdown era when the plastic raw material was quoted at 62.99 INR/kg in May 2020.
Since the rise began in early June 2020, spot K67(PVC Resin Virgin) prices in Italy and Northwest Europe increased by around 900-950 EUR/MT, or by 135%. In Europe, recent PVC offers for September suggested moderate rises despite the somewhat lower ethylene settlement. The bullish trend began its sixteenth month, with supply-demand dynamics continuing to be critical in determining the market's tone, increasing the prices. Several regional producers increased their offerings by up to 30-50 EUR/MT, while others increased them by less than 10-20 EUR/MT.
In 2020, Egypt was the fourth-largest export destination for US PVC. The export prices were 1,450 USD/MT in December 2020 which were expected to rise to as high as 2100 USD/MT. Since August 2020, when the first of two hurricanes struck Louisiana within six weeks of each other, the export supply availability was constrained, exacerbated by widespread shutdowns in response to a deep freeze that hit the US Gulf Coast in mid-February 2021 and Hurricane Ida's landfall in Louisiana.
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Procurement Resource provides prices of PVC for several regions around the globe, which are as follows:
The initial step of polymerisation includes liquefying and putting pressure on raw VCM material. After that, it is processed in a polymerisation reactor, where it meets water and suspending agents. Then, it is fed into another reactor, where PVC is manufactured at 40 – 60°C. PVC obtained upon the completion of process is suspended in water as particles of 50~200 μm diameter and that too in slurry form.
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The displayed pricing data is derived through weighted average purchase price, including contract and spot transactions at the specified locations unless otherwise stated. The information provided comes from the compilation and processing of commercial data officially reported for each nation (i.e. government agencies, external trade bodies, and industry publications).
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