quarterlyssessments-q2-2020-sea-pvc-prices

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Local PVC offers started to shift in May and June, especially in Thailand
PVC demand in Southeast Asia was sluggish entering the second quarter of 2020
PVC demand in the region expected to be slower as the rainy season intensifies

In April, local and import PVC prices in the Southeast Asia market were on a downtrend. In Thailand, local PVC prices for April delivery continue to decline week after week with a total decrease of THB2,500/ton ($80/ton) compared to March delivery. While in the Philippines, local PVC offers remain stable in the first half of April and stood between PHP55,000-56,000/ton ($1,109-1,129/ton) on 90 days credit term, FD Philippines basis and including 12% VAT. However, as the market became stagnant and coupled with maintenance shutdowns at the local producers’ plants, no offers were available in the second half of the month. In the import market, according to SSESSMENTS.COM’s pricing database, May shipment offers from the leading Taiwanese PVC producer dropped $160/ton compared to April shipment. Follow suit, Thai and Indonesian PVC producers also trimmed May shipment offers by the same amount. Meanwhile, May shipment offers from a Japanese PVC producer to the Southeast Asia market decreased by $190/ton compared to the same period. However, despite the hefty reduction, only limited deals were concluded.

In May, local PVC offers in Thailand captured at THB3,000/ton ($96/ton) on the monthly comparison. A local converter’s bid at THB2,500/ton ($80/ton) lower from the initial offer level was rejected citing that suppliers were only willing to give discounts up to THB1,000/ton ($32/ton) for a big volume of purchase. The offers remained stable until the end of May and stood at THB24,500-25,000/ton ($785-801/ton) depending on payment terms. While in the Philippines, there were no fresh offers reported as PVC plants at the local producers’ end remain shut in May amid the lockdown due to the Coronavirus. For import, at the beginning of May, a global trading house sold out May shipment allocation for Indonesian and Japanese PVC cargoes to Southeast Asia market with the deals concluded between $620-650/ton on LC at sight, CIF Southeast Asia Main Port basis. On May 19, the leading Taiwanese PVC producer announced June shipment offers with an increment of $40/ton from May shipment. Likewise, a Japanese PVC producer adjusted upwards June shipment offers by the same amount. However, the producer mentioned to SSESSMENTS.COM that satisfactory sales were only to the Vietnam market with the done deals concluded at the initial offer level at $680/ton on LC at sight, CIF Southeast Asia Main Port basis.

Entering June, local PVC offers in Thailand remain on an uptrend as a local producer announced June delivery offers at THB1,500/ton ($48/ton) higher compared to May delivery. In contrast, June delivery offers from a Philippines PVC producer dropped PHP8,000/ton ($161/ton) compared to the same period. From import, July shipment offers from Far East Asian PVC producers to Southeast Asia increased between $90-100/ton compared to June shipment. Likewise, July shipment offers from the leading Indonesian PVC producer to Malaysia surged by $80-90/ton on monthly comparison following the satisfactory sales at the beginning of June. Detailed information for Indonesia and Vietnam market is available in QuarterlySSESSMENTS of the respective countries.

PVC demand in Southeast Asia was sluggish entering the second quarter of 2020 as several countries in the region were under lockdown. In Malaysia, demand dropped as much as 90% as only 30% of PVC manufacturers received approval from the government to continue production with a maximum of 50% production rates. In Thailand, healthy demand was only reported from the pipe sector as the government kept projects to overcome the ongoing drought issue. PVC demand started to improve following the lockdown relaxation in several countries such as Malaysia and Thailand. While in the Philippines, the lack of manpower due to the public transportation issue still being the main problem; as such, some converters revealed to SSESSMENTS.COM that the company was unable to meet customers’ request despite the orders received. At the end of Q2, healthy demand recorded only in the domestic market. Buyers only purchase on a need basis, and due to this, they prefer to source from the domestic market. However, in Malaysia, the PVC market has improved especially for the compounding sector as most converters in this sector are currently running at 50-60% from normal capacity. On the supply side, there were no issues reported in the region.

On the production sector, Thailand’s SCG clarified that the company did not have any issues with the VCM plant, but the producer did not rule out possibilities for lower production rate ahead due to the drought in the country, however, the producer plans to conduct maintenance at the company 530,000 tons/year PVC plant for a week in July. While Philippines’ General Chemical & Resins Consortium Inc (GenChem) PVC plant with a capacity of 20,000 tons/year was shut amid the lockdown since March 2020 and was back on-stream on May 16 and currently running at full capacity, SSESSMENTS.COM noted.

For the outlook, market players believed that entering the third quarter of 2020, PVC demand in the region will be slower as the rainy season intensifies. As for pricing, PVC prices are expected to be on a downtrend as monsoon season continues to drench India market, the main PVC import market and benchmark for pricing, as stated to SSESSMENTS.COM.

Range of local ethylene-based PVC transactions in April on FD basis, excluding VAT (except in PHP term including 12% VAT, all equivalent in USD excluding VAT)

Origin	Transaction Type	Currency	Offers/ton	Equivalent in USD/ton	Payment Term	Delivery Country
Philippines	Offer Given	PHP	55,000-56,000	1,061-1,080	90 Days Credit Term	Philippines
Thailand	Offer Received	THB	26,500-28,000	849-897	30 Days Credit Term	Thailand
Thailand	Offer Received	THB	27,500	881	60 Days Credit Term	Thailand
Thailand	Offer Received	THB	27,500	881	75 Days Credit Term	Thailand
Thailand	Offer Received	THB	27,000	865	Cash In Advance	Thailand
Thailand	Purchased	THB	28,000	897	30 Days Credit Term	Thailand
Thailand	Purchased	THB	27,500	881	60 Days Credit Term	Thailand

Range of import PVC transactions in April

Origin	Product	Transaction Type	Offers (USD/ton)	Payment Term	Delivery Term	Delivery Country
China	Acetylene-based	Offer Received	630-650	LC at sight	CIF	Malaysia
Indonesia	Ethylene-based	Offer Received	650	LC at sight	CFR	Southeast Asia
Japan	Ethylene-based	Offer Given	630-720	LC at sight	CFR	Southeast Asia
Japan	Ethylene-based	Offer Given	640-660	LC at sight	CIF	Southeast Asia
Japan	Ethylene-based	Sold	750-760	LC at sight	CIF	Malaysia
Japan	Ethylene-based	Sold	620	LC at sight	CIF	Southeast Asia
Taiwan	Ethylene-based	Sell Idea	610-630	LC at sight	CFR	Southeast Asia
Taiwan	Ethylene-based	Offer Given	660	LC at sight	CIF	Southeast Asia
Taiwan	Ethylene-based	Offer Received	670	LC at sight	CIF	Thailand
Thailand	Ethylene-based	Offer Received	670	LC at sight	DAP	Malaysia
Thailand	Ethylene-based	Offer Received	640-695	LC at sight	CIF	Malaysia
Thailand	Ethylene-based	Sell Idea	630-640	LC at sight	CIF	Malaysia
Thailand	Ethylene-based	Sold	670-680	LC at sight	CIF	Malaysia
Thailand	Ethylene-based	Sold	790	LC at sight	CFR	Singapore

Range of export PVC transactions in April on LC at sight, FOB Thailand basis

Origin	Transaction Type	Offers (USD/ton)
Thailand	Sell Idea	620-630

Range of local ethylene-based PVC transactions in May on FD basis, excluding VAT

Origin	Transaction Type	Currency	Offers/ton	Equivalent in USD/ton	Payment Term	Delivery Country
Thailand	Bid Given	THB	22,000	705	60 Days Credit Term	Thailand
Thailand	Offer Received	THB	24,500	785	30 Days Credit Term	Thailand
Thailand	Offer Received	THB	24,500	785	60 Days Credit Term	Thailand
Thailand	Offer Received	THB	25,000	801	75 Days Credit Term	Thailand
Thailand	Purchased	THB	24,500	785	30 Days Credit Term	Thailand
Thailand	Purchased	THB	24,500	785	60 Days Credit Terms	Thailand
Thailand	Sell Idea	THB	25,500-25,750	817-825	Cash In Advance	Thailand

Range of import PVC transactions in May

Origin	Product	Transaction Type	Offers (USD/ton)	Payment Term	Delivery Term	Delivery Country
China	Acetylene-based	Offer Received	780-790	LC at sight	CIF	Malaysia
China	Ethylene-based	Offer Received	730-770	LC at sight	CIF	Malaysia
China	Ethylene-based	Offer Received	640	LC at sight	CIF	Thailand
Indonesia	Ethylene-based	Offer Received	650*	LC at sight	CIF	Malaysia
Indonesia	Ethylene-based	Purchased	640*	LC at sight	CIF	Malaysia
Indonesia	Ethylene-based	Offer Given	700	LC at sight	CFR	Southeast Asia
Indonesia	Ethylene-based	Sold	640-650	LC at sight	CFR	Southeast Asia
Japan	Ethylene-based	Offer Given	680	LC at sight	CIF	Southeast Asia
Japan	Ethylene-based	Sold	620	LC at sight	CFR	Southeast Asia
Taiwan	Ethylene-based	Offer Given	700	LC at sight	CIF	Southeast Asia
Thailand	Ethylene-based	Offer Given	650-725	LC at sight	DAP	Malaysia
USA	Ethylene-based	Offer Given	650-660	LC at sight	CFR	Malaysia

Description: *May shipment offers

Range of local PVC transactions in June on FD basis, excluding VAT (except in PHP term including 12% VAT, all equivalent in USD excluding VAT)

Origin	Product	Transaction Type	Currency	Offers/ton	Equivalent in USD/ton	Payment Term	Delivery Country
China	Acetylene-based	Offer Given	MYR	3,700	862	30 Days Credit Term	Malaysia
China	Ethylene-based	Offer Given	MYR	3,700	862	30 Days Credit Term	Malaysia
Philippines	Ethylene-based	Offer Given*	PHP	48,000-52,000	926-1003	90 Days Credit Term	Philippines
South Korean	Ethylene-based	Offer Given	MYR	3,700	862	30 Days Credit Term	Malaysia
Thailand	Ethylene-based	Offer Given	THB	25,500-26,000	817-833	Cash In Advance	Thailand
Thailand	Ethylene-based	Offer Received	THB	26,000	833	30 Days Credit Term	Thailand
Thailand	Ethylene-based	Offer Received	THB	25,500-27,500	817-881	60 Days Credit Term	Thailand
Thailand	Ethylene-based	Sell Idea	THB	26,500	849	60 Days Credit Term	Thailand

Description: *June delivery offers

Range of import PVC transactions in June

Origin	Product	Transaction Type	Offers (USD/ton)	Payment Term	Delivery Term	Delivery Country
China	Acetylene-based	Offer Received	800-830	LC at sight	CIF	Malaysia
China	Acetylene-based	Offer Received	800	LC at sight	CIF	Malaysia
China	Acetylene-based	Offer Received	810	LC at sight	CIF	Malaysia
China	Ethylene-based	Offer Received	830	LC at sight	CIF	Malaysia
China	Ethylene-based	Offer Given	790-800	LC at sight	CFR	Southeast Asia
Indonesia	Ethylene-based	Offer Given	780	LC at sight	CIF	Malaysia
Indonesia	Ethylene-based	Offer Received	690-780*	LC at sight	CIF	Malaysia
Indonesia	Ethylene-based	Purchased	690-780*	LC at sight	CIF	Malaysia
Indonesia	Ethylene-based	Sold	785	LC at sight	CIF	Malaysia
Indonesia	Ethylene-based	Sold	785	LC at sight	CIF	Singapore
Indonesia	Ethylene-based	Offer Given	780	LC at sight	CIF	Southeast Asia
Japan	Ethylene-based	Sell Idea	780-790	LC at sight	CIF	Southeast Asia
Japan	Ethylene-based	Offer Given	780	LC at sight	CIF	Southeast Asia
Japan	Ethylene-based	Sold	780	LC at sight	CIF	Southeast Asia
Japan	Ethylene-based	Offer Received	800**	LC at sight	CIF	Thailand
South Korea	Ethylene-based	Offer Received	690*-790	LC at sight	CIF	Malaysia
South Korea	Ethylene-based	Purchased	690-705	LC at sight	CIF	Malaysia
Taiwan	Ethylene-based	Offer Given	790**-820	LC at sight	CIF	Southeast Asia
Taiwan	Ethylene-based	Sold	790-820	LC at sight	CIF	Southeast Asia
Thailand	Ethylene-based	Buy Idea	810-850**	LC at sight	CIF	Malaysia
Thailand	Ethylene-based	Offer Given	795	LC at sight	CIF	Malaysia
Thailand	Ethylene-based	Offer Received	765-865*	LC at sight	CIF	Malaysia
Thailand	Ethylene-based	Offer Received	730	TT	CIP	Malaysia
Thailand	Ethylene-based	Sold	815	LC at sight	DAP	Malaysia
USA	Ethylene-based	Offer Given	790	LC at sight	CIF	Malaysia

Description: *June shipment offers **July shipment offers

Tags: Asia Pacific,English,PVC,Quarterly,SEA

Published on July 7, 2020 12:14 PM (GMT+8)
Last Updated on September 24, 2020 5:01 PM (GMT+8)

QuarterlySSESSMENTS: Q2 2020 SEA PVC Prices

Author: SSESSMENTS

QuarterlySSESSMENTS: Q2 2020 SEA PVC Prices

Author: SSESSMENTS

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