Poly Vinyl Chloride Prices Plummeted in USA Amidst Lower Buying Momentum from the Export Market

Lacklustre demand for Poly Vinyl Chloride (PVC) in the global market has skewed the export margins for USA. As USA is among the largest producers of Poly Vinyl Chloride, the country fetches a major share of revenue by catering to the international demand. However, limited import inquiries in the USA have continued to tumble its prices in the region amidst the high operating rates.

Pick-up in market activities in early Q1 2022 is way below the expected rate due to the persisting Omicron uncertainties. Buyers have showcased bare minimum interest in bulk purchases as the material availability in the nation is already at par, relative to the demand pattern. Usually, the contract consignments are refreshed in early January which leads to higher overseas trading activities. However, inquiries for new contracts have been dull since the beginning of the year due to bearish market momentum.

Raw material availability for Poly Vinyl Chloride (PVC) is likely to shrink amidst a spate of turnarounds scheduled in chlor-alkali plants in Q1. The situation is expected to narrow the margins of players as they would not be able to transfer the cost pressure upon consumers if the demand scenario remains same. On the other hand, as the availability of Chlorine is expected to decline this could result in shortage of Poly Vinyl Chloride in late-Q1, as the operating rate of several PVC plants might be compromised.

Poly Vinyl Chloride US FOB prices fell by nearly 4% in the week ending 14th January.  As per ChemAnalyst, “Prolong dullness in PVC prices is likely to make players anxious over the mounting inventory levels. However, as PVC prices have already reached tragic lows, a major fall in its prices is unlikely to be witnessed.”