India PVC Market Making A Progress After Lockdown Relaxation
- Local PVC cargoes are in demand with not many materials available in the market
- Import Taiwanese PVC offers surfaced in line with traders’ prediction
- Players voiced out positive outlook
SSESSMENTS.COM was informed by market players that India’s PVC market is moving into positive territory for this week after improving throughout the previous week. All domestic producers on Monday, May 18, decided to increase the offer by INR2,000/ton ($26.5/ton) from the previous offers to compete with localized and import PVC cargoes. Offer for local ethylene-based PVC cargoes is now in the range of INR63,000-65,000/ton ($836-863/ton). Some deals achieved at initial offer levels. Producers and traders mentioned that the current healthy digestion rate is supported by the limited availability of materials in the market. According to the trader, the market is also quick to absorb localized PVC cargoes from Russia offered at INR63,000/ton ($836/ton) on EXW Mumbai. Converter also informed on receiving offers for localized Thailand PVC cargoes at INR65,000/ton ($863/ton) on EXW Chennai basis. All offers listed above are on cash and excluding 18% GST. Speaking of the import market, June shipment offers from the leading Taiwanese PVC producer surfaced at $740/ton before volume discount. The move from the Taiwanese producer will have a domino effect on the offer that will be announced by a Japanese producer that previously voiced out sell idea at $750/ton. All import offers on LC at sight, CIF Nhava Sheva Port.
Driving factor of market improvement is the normalization of factory activity and downstream consumption, SSESSMENTS.COM noted. Producers report that their PVC plants are running at maximum capacity to meet the demand from converters. Most converters in India are currently running at 50% from normal capacity, including the factories in red zones; Mumbai and Delhi. Market players informed that the consumption of durable materials supported by end-product orders has reached 50-60% and will be better in the next 10-20 days. Logistics issues persist this week as transportation is not fully running yet because some states are still under lockdown, but going forward will be better.
The majority of market players agreed that Indian PVC market will move up and can be even better before the monsoon season kicks-in and makes another direction change. Traders contacted by SSESSMENTS.COM also opined that an increase in import PVC offers would push domestic prices to rise even further.
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Local/localized ethylene-based PVC offers on cash (excluding 18% GST in all terms)
| Origin | Transaction Type | Offers (INR/ton) | Equivalent in USD/ton | Delivery Term | Delivery Location |
|---|
| India | Offer Given | 65,000 | 863 | EXW | Cuddalore |
| India | Sold | 65,000 | 863 | EXW | Cuddalore |
| India | Offer Received | 63,000 | 836 | EXW | Mumbai |
| India | Offer Given | 64,500 | 856 | EXW | Mumbai |
| India | Purchased | 64,000 | 850 | FD | Bengaluru |
| Russia | Offer Given | 63,000 | 836 | EXW | Mumbai |
| Russia | Sold | 63,000 | 836 | EXW | Mumbai |
| Thailand | Offer Received | 65,000 | 863 | EXW | Chennai |
Import ethylene-based PVC offers on LC at sight, CIF India Main Port basis
| Origin | Transaction Type | Offers (USD/ton) |
|---|
| Taiwan | Sell Idea | 720 |
| Taiwan | Offer Given | 740 |
| Taiwan | Offer Received | 730-740 |
| Japan | Sell Idea | 750 |
Tags: Asia Pacific,English,ISC,India,PVC,Weekly
Published on May 19, 2020 1:05 PM (GMT+8)
Last Updated on May 19, 2020 2:41 PM (GMT+8)
