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European and Turkish PVC

European and Turkish PVC: Strong demand to continue early into 2021

European and Turkish PVC: Strong demand to continue early into 2021
European PVC December demand continues to remain strong, as customers prepare to secure more supplies for early next year, supporting the stability of market prices.
  • Customers prepare to secure supplies
  • December contract price settlement still ongoing

European PVC December demand continues to remain strong, as customers prepare to secure more supplies for early next year, supporting the stability of market prices.
S&P Global Platts assessed domestic net contract prices on Dec 16.
Eur1020/mt FD Germany, all time high since Jan 2 2013, and an increase of Eur20/mt above November level, still double the cost of the feedstock ethylene.
“Customers want to have more product, more than they actually need” a producer said, adding that January could be another tough month for producers due to the customer experience over the past three months, and that the main focus at the moment being the assurance of supply stability for the first half of 2021.
December PVC contract price settlements were still heard ongoing, a producer said that they were concluding deals between Eur20-30/mt above November, while a converter commented “First offers were plus Eur30-40/mt, but it looks that we will be able to reduce the increase, discussions with different suppliers are held” and added that negotiations would probably finalize with increases of Eur10-20/mt.
Supply availability is seen to continue to remain limited until the end of the year, “The stocks are rather low or empty, but we were able to receive everything that we need this month” a converted said.
The market is waiting on announcements from Inovyn, KemOne and ShinEtsu about when the FMs are planned to be lifted, as US Formosa has lifted the FM declared on Aug 14. KemOne and ShinEtsu declined to comment, while Inovyn was not immediately available Dec. 16.
European spot market FD NWE was assessed stable on the week at Eur950/mt, considering the stable market fundamentals in the region.
Export markets remained also attractive due to higher prices above the European levels, particularly Tukey and Brazil, while another producer commented that they will continue to supply the European market and not currently considering any exports.
In Turkey, given a mild winter, construction activities could continue, industry sources said, which further supported PVC demand in the region. Supply continued to remain tight, especially from Europe, according to sources. A wider offer range has been seen for the resin, between $1,370 - $1,550/mt CFR Turkey from various regions. S&P Global Platts assessed PVC import prices at $1,380/mt CFR Turkey, up $10/mt on the week, pending further deal corroborations.

Dec 17, 2020 18:34
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