Global PVC Prices Likely to See Improved Market Sentiments Toward the End of Q1, 2023
- 03-Mar-2023 1:55 PM
- Journalist: Jacob Kutchner
Polyvinyl Chloride (PVC) price movement is expected to turn positive in the global market, owing to increasing international inquiries and reviving downstream construction sector demand towards the end of Q1 2023. The buyers are experiencing a shortage of stocks in the downstream sector amid the upcoming peak summer construction season, while upward momentum of exports in the market at the termination of February 2023.
US PVC prices were stable at slightly higher values as PVC exports rose sharply in February 2023. However, high inflation dampened domestic demand in the country's construction sector. Occidental Petroleum saw prolonged uncertainty in the PVC demand in the mid-Q1 of 2023 and kept the prices rolling over this month. Moreover, the company sees pent-up downstream construction demand amidst low inventories and an anticipated rise in the interest rates in the US market.
In addition, domestic PVC demand in the Chinese market has not increased remarkably since the pandemic-related disturbances. As per the National Bureau of Statistics, the production firms ramped up operations as the COVID-19 disruptions waned, and the downstream sectors, such as the construction sector, observed economic stabilization in February. Furthermore, the rebound in manufacturing activities across the country has resulted in the elevation in the purchasing interest amongst domestic buyers at a slow pace and made purchasing manager index settle at 56.4 in February 2023. As a result, this led to the upward price momentum of PVC in China at the termination of February 2023.
Meanwhile, European PVC traders managed to put an end to the persistent bearish market in February 2023. PVC's spot and contract prices slightly increased and were supported by the higher upstream Ethylene costs. Additionally, the market players expect to witness an upward price trend of PVC in March in Europe, keeping their eye on the monomer settlements.
As per the ChemAnalyst, consequently, PVC prices will witness a northward trajectory across the globe in March 2023, owing to the improving downstream demand and anticipated high export inquiries for the product, coupled with lower levels of inventories to satisfy new offers.