Limited Procurement From the Downstream Industries Plunge Calcium Carbide Prices in China
Limited Procurement From the Downstream Industries Plunge Calcium Carbide Prices in China

Limited Procurement From the Downstream Industries Plunge Calcium Carbide Prices in China

  • 24-Mar-2023 4:30 PM
  • Journalist: Harold Finch

Beijing, China: Since the start of March 2023, the prices of Calcium Carbide have been consistently dropping in the Chinese domestic market. The decline in consumption reported from the downstream Polyvinyl chloride (PVC) industries has impacted the price value chain of Calcium Carbide. The global economic slowdown and the cheaper offers from other countries have shifted the downstream purchases from China, hampering the supply-demand fundamentals. Thus, as a result of sluggish downstream demand, the manufacturers were compelled to revise their offers to gain some profit margins.

In anticipation of the supply-chain problem amid COVID restrictions, the manufacturers had kept large volumes of Calcium Carbide stocks. However, despite a sudden boost in manufacturing activities last month, the demand from the downstream industries did not escalate proportionally, seeding the bearish market sentiments among the market players for Calcium Carbide. As per the ChemAnalyst database, the Calcium Carbide prices have demonstrated a decrement of approximately 20 USD per tonne on 24th March 2023, compared to the price observed in early March.

As per the market sources, one of India's major downstream PVC manufacturers, Reliance Industries Ltd (RIL), is likely to shut its PVC plant with a production capacity of 3,50,000 MT/Year for a maintenance turnaround in April 2023 for about two weeks. In addition, rising interest rates in the United States had a particularly negative effect on the building and construction industries, with housing starts falling by about 22% year over year in late 2022. Moreover, in the spot market for various chemicals, including Calcium Carbide, the price of shipping a box by sea from China to the West Coast of the United States has dropped from almost USD 16,000 per Forty-Foot Equivalent Unit (FEU) a year ago to just over USD 1,000.

According to the pricing intelligence of ChemAnalyst, the Calcium Carbide prices might sustain their downward momentum in the near term amidst limited inquiries from its downstream end-use industries. The external demand from the Western market is relatively low. Thus, it is most likely to impart minimum support to the strengthening of market fundamentals of Calcium Carbide in the forthcoming weeks.

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