Local ethylene-based PVC offers on cash, FD Vietnam basis (excluding 10% VAT in all terms)
Import ethylene-based PVC offers on LC at sight, CIF Vietnam Main Port basis
Description: *All offers for August shipmentSources: Vietnamese PVC Suppliers In Sales Struggle Amid Seasonal Slowdown
- Local offers shifted in line with import price trend
- Market is grappling with supply overhang amid the seasonal slowdown
- Near-term outlook remains pessimistic
Market sources in Vietnam revealed to SSESSMENTS.COM that most domestic and import suppliers are in a sales struggle as seasonal slowdown bites. This week, Vietnam’s domestic and import PVC prices continued on an upward trend, with most prices taking cues from pricing in the international market. One of the local producers dropped hints at a possible increase for upcoming August delivery offers, indicating an increase of between $20-30/ton and is planning to announce offers within this week. Meanwhile, a few buyers reported on receiving fresh offers from another local producer with an increase of VND500,000/ton ($21.4/ton) from last month’s level. From the traders’ end, most companies have separately announced increases of between VND200,000-300,000/ton ($8.5-12.8/ton) for local ethylene-based PVC cargoes from a week earlier, citing an uptrend in the international market. However, most traders have been facing difficulties in concluding deals in the domestic market due to strong resistance from buyers. From the import market, some converters in Vietnam reported receiving August shipment offers from Thai and Taiwanese producers at $30/ton higher from July shipment offers. However, most buyers are reluctant to take the cargoes as the offer level is deemed too high considering the current market situation. Besides, suppliers are unwilling to entertain requests for steep discounts.
Domestic demand in the Vietnam PVC market is sluggish this week, with limited spot trading activity taking place amid a seasonal market lull. Over the week, most converters in the country prefer to halt procurement activities due to slow demand in domestic and export destination countries. Besides, as the relentless rally in the energy market has sent most commodities prices spiralling upward, buyers in the country continue to pose a stronger resistance toward higher offers and hold back purchases in anticipation of lower prices in the near term. As seasonal slowdown hits the market, manufacturers are still running at a reduced capacity, with a few even shutting units down due to a massive slump in demand from the end-user segment. Most manufacturers said that the monthly average operating rate in July is down by 40-50% month-on-month. On the supply front, sources in Vietnam pointed out that most buyers are still saddled with high inventory amid an unprecedented drop in end-products demand.
Market participants in Vietnam believe that the near-term outlook for PVC market will remain pessimistic as supply overhang and demand slowdown is predicted to continue weighing on the market sentiment, SSESSMENTS.COM was informed.
Tags: Asia Pacific,English,PVC,SEA,Vietnam,Weekly
Published on July 21, 2020 1:37 PM (GMT+8)Last Updated on July 21, 2020 2:31 PM (GMT+8)
